The cabinet has rejected calls for the reintroduction of a 60% income tax rate to ease the budget deficit, various newspapers report on Thursday.
During a parliamentary debate on the government’s 2010 spending plans, prime minister Jan Peter Balkenende said ministers were not in favour of the move. The coalition Labour party has called for a 60% top income tax rate to help cut the budget deficit.
The 60% tax rate was cut to 52% in 2001. Balkenende told MPs there had been good reasons to make that cut, and the Netherlands did not want its income tax system to be too different to that of other EU countries.
The cabinet is setting up 20 commissions to investigate all areas of government policy with a view to making cuts and raising more money for the treasury and Balkenende has said all options are open.
‘There are no taboos’, the prime minister reiterated on Thursday. ‘But I am telling you how we look at the issue.’
‘No taboos in an investigation which will lead to nothing,’ commented Femke Halsema, leader of the left-wing green party GroenLinks.
Balkenende also disputed claims that the cabinet is delaying taking action to boost the treasury for too long. He said he expected the fruits of the commissions’ work could be first debated in June 2010, with the final decisions made ahead of next year’s budget presentation in September.
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