The tax office is not allowed to pass on information about tenants’ income to landlords, who then use the details when calculating rent increases, the Council of State said on Wednesday.

The Council of State is the highest Dutch administrative court.

Housing minister Stef Blok introduced the tax office check two years ago as part of a package of measures to encourage high earners to leave rent-controlled housing and move into the private sector.

Landlords were allowed to increase the rent by up to 4% plus inflation for people earning more than the legal limit to live in social housing.

Confidential

The case was taken to court by a tenant who did not want the tax office to give his landlord information about his income. The court ruled that the tax office has a duty to keep such information confidential and that Blok’s law does not explicitly require officials to brief landlords on their tenants’ finances.

Blok said in a reaction that new legislation currently being processed in parliament will remove the loophole and he hoped this would be completed before July 1, when new social housing rents are set.

Meanwhile, tenants’ lobby group Woonbond said it is looking into the option of helping tenants claim back millions of euros in extra rent which they had paid because of the higher rent increases.