Netherlands Seeks Alternatives to Postponed VAT Increase

• The Dutch government is searching for an alternative to the postponed VAT increase.
• The government needs to find a way to cover a €1.2 billion VAT shortfall.
• A proposal to raise the general VAT rate from 21% to 21.4% was met negative reactions from businesses and parliament.
• A proposal to abolish the low VAT rate for certain categories also lacks support.
• The State Secretary has proposed a uniform VAT rate as an alternative.
• A uniform VAT rate could be achieved by raising the reduced VAT rate for all products except food.
• The State Secretary proposes a gradual implementation of a uniform VAT rate, starting with a temporary middle rate for certain categories in 2027.
• A VAT increase in 2026 is still necessary to address the budget gap.
• The State Secretary aims to present a legislative proposal by July 1, 2025.
• If no alternative is found, the VAT increase on culture, media, and sports will be implemented on January 1, 2026.

Source: fiscount.nl

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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