Sunday 17 January 2021

Budget leaks start: €500 bonus for nurses, and an income tax cut for all


Three weeks before the government is due to present its 2021 spending plans, the leaks have already started in The Hague.

The Telegraaf said on Thursday that healthcare staff will get a further bonus of €500 next year, on top of the tax-free payout of €1,000 in 2020. However, there will be no structural pay increase for hospital staff, as opposition MPs have demanded.

In addition, the Telegraaf reports that there is pressure from the coalition parties to cut the basic tax rate, currently 37.35%, by one percentage point in an effort to boost spending power.

As expected, the planned reduction in corporation taxes for large companies will not now go ahead, but small firms will have to pay less, the Telegraaf says. Its sources suggest the corporate tax rate for smaller firms will go down from 16.5% to 15% and all companies with net profit of less than €400,000 a year will fall under the lower tax rate.


NOS reports that the tax break for the self employed will be reduced in stages of €110 to €3,240, around half its current level, but there will be a compensation package of some sort.

The broadcaster’s sources also suggest that first time buyers will no longer have to pay a tax of 2% over the purchase price of their property – saving them some €4,000 on a home costing €200,000.

Meanwhile, talks on a third package of support for companies hit by the coronavirus crisis are still ongoing.

Insiders say that the Tozo subsidies for the self employed will be extended to July 1 next year, but that an asset check will be part of the deal.

Government insiders told the papers earlier this week that the threshold for receiving help in paying wages will go up from a minimum of a 20% drop in turnover to 30%. At the same time, the sources suggest, companies will only be able to claim 60% to 80% of wages from the state, compared with 90% in the current NOW scheme.

The budget will be presented to MPs and the public on September 15, just six months ahead of the general election.

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