Will the 30% rule be eliminated?
As of 1 January 2024, the Dutch government introduced changes to the 30% ruling, a tax advantage that benefits highly skilled migrants working in the Netherlands. However, due to heavy criticism from both Dutch and international companies, these changes are likely to be reversed.
Who will be affected?
The reversal would affect companies based in the Netherlands that employ highly skilled workers from abroad. The 30% ruling has been crucial for attracting international talent by allowing employers to reimburse up to 30% of their employees’ income tax-free.
Changes to the 30% Ruling
The gradual reduction of the 30% ruling sparked concerns across the business community, with many companies threatening to relocate. According to the Dutch Ministry of Finance, the reduction would lead to a decrease of 15-20% in highly skilled migrants, impacting the Netherlands’ knowledge-based economy.
The initial plan aimed to scale back the ruling in phases:
- First 20 months: A maximum of 30% tax savings applies.
- Next 20 months: A maximum of 20% tax savings.
- Final 20 months: A maximum of 10% tax savings.
However, recent plans suggest that the reduction may be less significant, adjusting the ruling to 27%.
Even if these changes are implemented, relocating to the Netherlands will still offer significant advantages, as the country remains an attractive destination for international companies and talent due to the continued tax benefits.
Questions about the 30% rule?
Although no final decisions have been made yet, we will keep you informed as soon as more details are confirmed. If you have any questions in the meantime, feel free to reach out to us by scheduling an appointment through our website.
