The Dutch Budget 2019 has been presented on “Prince’s Day”, the third-Tuesday-of-September. Traditionally, on this day the King rides in his golden chariot to the parliament building to read the 2019 ‘throne speech’. On the same day, the budget plans for the coming year are presented.
VAT related changes:
- Simplification small entrepreneur scheme in VAT
The small entrepreneur scheme will be adjusted on 1 January 2020. The new rules will allow small businesses to not charge VAT to their customers and therefore no longer state VAT on their invoices. Furthermore, these entrepreneurs are released from filing VAT returns and from the corresponding administrative obligations. On the other (down)side, the VAT that is charged to these entrepreneurs can not be deducted if they choose to apply the small entrepreneur scheme. The scheme applies only to goods deliveries and services performed in the Netherlands. The system remains optional. - Increase reduced VAT rate from 6% to 9%
The reduced VAT rate will be increased as of 1 January 2019 to 9%. The reduced rate is applied specific goods, such as food, and non-alcoholic beverages, and to certain services such as access to museums and theater and music performances.
For services carried out after 31 December 2018 but for which before 1 January 2019 a reimbursement has been received, the current VAT rate of 6% applies. Unlike VAT rate increases in the past, this time the rate difference (of 3%) will not be added. This means that In that case, entrepreneurs have the opportunity to change the current 6% rate to future performance. - Extension of the VAT sports exemption
The Dutch VAT exemption for sports and sports-related activities will be expanded as of 1 January 2019. This is the result of European developments in this area. Consequence of the change is that more activities will be exempt from VAT (more specifics on the sports-changes HERE (Dutch)). - VAT rules for electronic services simplified
Where all entrepreneurs now have to calculate foreign VAT to their private EU customers if they perform electronic services, a threshold will be introduced as of 1 January 2019. This makes it easier for smaller businesses: if their turnover from such services per year is less than € 100,000, they may charge the VAT of their own country of residence (somewhat similar to the distance selling rules for goods). The invoicing rules for such services are also simplified
Source: ING Bank (general overview)
Source: EY (tax details – in Dutch) – Chapter 5 deals with VAT
Source: BTW Plaza (Dutch)
