On 19 December 2023, the Dutch Senate (upper house of parliament) passed the Tax Plan for 2024, which includes the Pillar 2 global minimum tax and other tax measures.  On 27 October 2023, the House of Representatives (lower house) approved the Tax Plan and other tax measures.

The main tax measures include:

  • The individual income tax rate for Box 1 income (including employment and other income) has been increased from 36.93% to 36.97%;
  • The threshold for the top tax bracket (49.50%) is raised from EUR 73,031 to EUR 75,518;
  • The general tax credit has been raised from EUR 3,070 to EUR 3,362;
  • The top tax rate on individual Box 2 income (income derived from a substantial interest) will be increased to 33% from 31%;
  • The proposed increase in the tax rate on individual Box 3 income (taxable income from savings and investments) has been increased to 36% from 34%;
  • The discount on payment for provisional income tax assessments has been repealed for corporate income tax purposes;
  • Implementing amendments to ensure that value-added tax (VAT) and transfer tax are paid when transferring newly acquired real estate through share transactions;
  • An amendment to abolish the EBITDA-based interest deduction limitation for real estate companies. Therefore, there is no EUR 1 million safe harbor threshold for net interest expenses for real estate companies. Instead, any net interest expenses exceeding 20% of EBITDA will be non-deductible;
  • From 1 January 2025, the tax-free share buyback facility for listed companies will no longer be available. This means the deemed distribution of reserves in share buybacks for Dutch tax resident listed entities will be subject to taxation at a dividend withholding tax rate of 15%;
  • The bank tax on the portion of the taxable amount associated will increase from 0.044% to 0.058% for short-term debts and from 0.022% to 0.029% for long-term debts;
  • Effective 1 January 2025, there will be amendments to the taxation regulations about fiscal investment funds (fiscale beleggingsinstellingen – FBI). Under the new provisions, these funds will no longer be eligible for a 0% corporate income tax rate when investing in Dutch real estate.

The Tax Plan for 2024, alongside other tax measures, must be published in the Official Gazette to be officially implemented.

Meanwhile, the Dutch Senate (upper house of parliament) also passed the Minimum Tax Act 2024 on 19 December 2023.  This law provides for implementing the Pillar 2 global minimum tax in line with the Council Directive (EU) 2022/2523 of 14 December 2022.

This includes the introduction of the Pillar 2 income inclusion rule (IIR) and the undertaxed payment/profit rule (UTPR) to ensure a minimum corporate tax of 15% for large multinational (MNE) groups with annual consolidated revenue of at least EUR 750 million in at least two of the preceding four fiscal years. The rules apply to all domestic and international groups with a parent company or subsidiary in an EU member state. The bill also proposes implementing a qualified domestic minimum top-up tax (QDMTT) for members of in-scope groups and certain safe harbors.  The IIR and QDMTT apply for financial periods beginning on or after 31 December 2023, while the UTPR generally applies for financial periods beginning on or after 31 December 2024.  The Minimum Tax Act 2024 needs to be published in the Official Gazette to come into effect.

On 31 May 2023, the Minimum Profit Tax Act 2024 was presented to the Lower House of Parliament.