Cabinet effectively pulls plug on DBA freelancer legislation

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The cabinet has agreed not to enforce laws introduced by the previous cabinet to ensure freelancers really are self-employed until January 2020 – by which time it hopes to have come up with new legislation of its own.

However, from July this year, officials will do more to weed out problems at the lower end of the labour market, to make sure employers are not using freelance contracts to get round laws on taxes and premiums, social affairs minister Wouter Koolmees told parliament on Friday.

Since May 2016, tax office-issued VAR certificates for freelancers have been replaced by individual contracts between freelancer and client. While contracts are not compulsory, if the tax office decides that a freelancer is effectively an employee, the employer will be liable for social insurance premiums and other payments.

Sham self-employment

The aim of the changes is to stamp out sham self-employment, but in practice, there is mounting evidence that companies are dropping their freelancers.

Some 1.3 million people in the Netherlands do some sort of freelance work, often alongside a regular job, according to figures from the national statistics agency CBS.

In total, almost 800,000 people rely solely or mainly on income from freelancing while a further 553,000 rely on another source of income – a part-time job, pension or social security benefits – to make ends meet, the CBS said.