What had been agreed? State pension at 66 in 2015, VAT to 21%

The minority cabinet and anti-immigration PVV had agreed on a large number of measures to cut the budget deficit when the talks collapsed on Saturday.

According to RTL news, the total package would have generated over €14.2bn for the treasury through a combination of cuts and tax increases.
The broadcaster said the government’s macro-economic think-tank CPB calculates the total package would reduce the budget deficit to 2.8% next year, below the 3% target demanded by Brussels.
However, the impact on spending power would have been considerable. Pensioners in particular would have had at least 3% less to spend next year.
The main points of the agreement

  • The state pension age to go up to 66 in 2015, not 2020 as planned
  • An introduction of a €9 fee for every medical prescription
  • An increase in value-added tax: the low rate to rise from 6% to 7%, the high rate from 19% to 21%
  • A €750m cut on the €4.6bn development aid budget
  • No tax relief on interest-only mortgages
  • A cut of €75m on spending on public broadcasters
  • No change in unemployment benefit or redundancy law
  • An across-the-board salary and benefit freeze, apart from state pensions and incapacity benefit
  • An end to student grants
  • Parental contribution for school books to be brought back
  • An end to the tax break on employee travel costs
    Sources: RTL nieuws, Volkskrant, Nos

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