Five-party commuter tax plan ‘unlikely’ to actually happen

The plans to scrap the tax break on commuting costs which form part of the austerity package finalised last month are unlikely to ever be realised, the Volkskrant reports on Saturday.

The paper says four of the five parties which drew up the measures are already distancing themselves from the proposal ahead of the September 12 general election.
The measure, which according to most estimates will cost commuters upwards of €80 a month, is one of a package designed to reduce the Dutch budget deficit to below 3%.
But the Volkskrant says the VVD, senior partner in the outgoing government and one of the signatories to the austerity deal, will not support the measure in its election manifesto. Sources say party officials believe there will be enough time in the autumn to come up with replacement cuts.
The Christian Democrats, who published their draft manifesto on Friday, leave the tax break unchanged but do propose bringing in road pricing – a tax on every kilometre travelled.
And Jolande Sap, leader of the green party GroenLinks said on Thursday she did not want the measure to apply to people who use public transport – a similar position to ChristenUnie.
The only party of the five which has not explained its position is D66. ‘We signed the spring accord. An alternative measure will have to raise as much, so whatever happens it will be painful,’ MP Wouter Koolmees told the paper.
The austerity package envisages the government generating €1.3bn by scrapping the tax break on travelling expenses – which will hit commuters’ spending power by 1.5%. In total, the government has to generate €12bn in 2013 to meet eurozone monetary union rules.
Last week the European Commission warned the Netherlands that if the next government wants to deviate from the agreed plans, it will have to ensure the results are similar.
Poor economic prospects and rising unemployment are creating ‘major challenges for the Netherlands’ in a ‘very complex political situation,’ the commission said in its report on Holland.
The austerity measures will form the main plank of next year’s government spending plans, which will be published on September 20, just eight days after the general election. This means a new line-up of MPs will actually vote on them. Opinion polls show the five parties are currently unlikely to form a majority.

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