Many questions about asset tax remain pending new court opinion

Photo: Joep Poulssen
Photo: Joep Poulssen

Many questions remain about the legality of revised plans to tax savings, investments and property following last year’s court ruling which said the tax office should use actual rather than fictive returns, the Financieele Dagblad reported on Monday.

Tax minister Marnix van Rij has introduced a temporary solution ahead of the shift to a new system in 2027, but the Supreme Court has not yet said if this is an acceptable stop-gap measure.

And until this has happened, the tax office is not dealing with any protests from taxpayers about the temporary solution, the paper said. Nor is the tax office sending any new definitive tax demands.

Last week Van Rij sketched out several new variations to refine the temporary tax but these too are likely to be rejected by the Supreme Court, Bernard Bavinck, a former court judge, told tax publication Weekblad Fiscaal Recht. In particular the impact of setting the wrongs right will present huge problems to the government, Bavinck said.

Notional rate

The need to overhaul the system stems from a December 2021 ruling by the Supreme Court which said the government was wrong to impose a notional ‘flat rate’ savings and assets based on the assumption that savers would earn 4% on their investments.

The transitional system still uses notional rates but distinguishes between savings, which are currently taxed at 0.01%, investments, which are subject to a variable rate of around 6%, and debts, where the rate is around 2.5%.

In March Dutch investors’ association VEB said it is taking legal action against the government’s decision to use a notional return of 5.5% to calculate the tax on assets over 2022, arguing the real figure is -14%.

Van Rij will debate his suggested changes to the transitional arrangement with MPs on May 9.

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