On December 19, 2023, debates and voting on the 2024 Tax Plan (Belastingplan 2024) took place, including two key amendments regarding changes to the 30% ruling and the partial non-resident tax status (PNRT), which we discussed earlier.
Contrary to the hopes of optimists, both amendments were adopted in their original form:
30% Ruling
For all expats moving to the Netherlands after January 1, 2024, the 30% ruling will follow this structure:
- 30% ruling: Applies for the first 20 months of work in the Netherlands.
- 20% ruling: Applies for the next 20 months.
- 10% ruling: Applies for the final 20 months.
Those who received and began using the 30% ruling in 2023 will retain the full 30% benefit for its duration, according to clarifications provided by the Secretary of State for Taxes and the Tax Authority to the lower chamber.
Partial non-resident tax status (PNRT)
For expats moving to the Netherlands after January 1, 2024, PNRT will cease to apply starting January 1, 2025.
Expats who used this status in 2023 are allowed to keep it until December 31, 2026.
What does this mean?
The absence of PNRT means expats will need to declare all their global assets, passive income, and foreign dividends to the Dutch Tax Authority starting January 1, 2025. They will also pay taxes on these (box 2 and box 3) like other Dutch residents.
Is that all?
Not quite. During the December 19 debates (all 13 hours of video can be viewed here or reviewed in the debate transcript), Senator Geerding (VVD) proposed that the Secretary of State for Taxes, Mr. van Rij, accelerate the planned evaluation of the 30% ruling’s effectiveness. He also suggested reworking the 30% ruling and other tax changes that harm the Dutch economy to ensure they are revised adequately and well in advance for the 2025 Tax Plan.
The majority of the chamber members supported this proposal, and the Secretary of State pledged to give this matter thorough attention for the 2025 review.
A traditional fun fact
Immediately after the debates and just before the vote, the chamber’s chair responded to the question, “What happens if we don’t pass the 2024 Tax Plan?” His reply: “Then we’ll have a €5 billion budget hole, and chaos will reign in the country.”
It’s also worth noting that both the upper and lower chambers repeatedly expressed dissatisfaction with the speed and accompanying disorganization with which laws and amendments were introduced and passed this year.