Prinsjesdag 2024: Tax Changes and Measures for 2025 in the Netherlands
Prinsjesdag is a key event in the Netherlands, where the government presents its budgetary and tax plans for the upcoming year.
During Prinsjesdag 2024, a series of important reforms were announced that will take effect in 2025, impacting individuals, expatriates, entrepreneurs, and various economic sectors. Below are the main changes:
The income tax system will undergo changes in 2025, with adjusted rates across the various tax brackets. Here’s a summary of the key changes:
- Box 1: Income from salaries
Workers will see a reduction in the tax rate for incomes below €38,441, where a rate of 35.82% will apply (around 1% lower than in 2024). For incomes between €38,441 and €76,817, the rate will be 37.48%. Incomes over €76,817 will continue to be taxed at 49.5%.
Salary range | Tax rate on salary |
Up to €38,441 | 35.82% |
From €38,441 to €76,817 | 37.48% |
Over €76,817 | 49.5% |
- Box 2: Income from shares
If you own 5% or more of a company’s shares, you have a “substantial interest” and could receive dividends. In 2025, you’ll pay 24.5% tax on dividends up to €67,804, the same as in 2024. For higher gains, the tax will be 31%, compared to 33% in 2024.
The government aims to balance taxes between those with substantial interests, self-employed business owners, and employees, preventing business owners from choosing a legal structure purely for tax benefits.
Tax partners can split the profits, benefiting twice from the lower tax rate. For a gain of €135,608 (2 x €67,804), you would pay 24.5%. Additionally, the partner without income can take advantage of tax discounts when splitting the profits.
- Box 3: Savings and investments
In 2025, if you have savings or investments, you won’t pay taxes on your wealth up to €57,684. For amounts above that, you will pay 36% tax on the return that the Tax Authority estimates you could earn, known as “notional return.”
Debts are also included in this category. The Tax Authority sets a notional return for debts, which you can subtract from the return on your savings and investments. However, you cannot deduct a fixed amount from your debts, as there is a minimum debt threshold.
The notional returns on savings and debts will be determined at the end of 2025, while the return on investments will be fixed at the start of that year.
In 2025, the exemption for small and medium-sized enterprises (mkb-winstvrijstelling) will be reduced from 13.31% to 12.7%. Additionally, the deduction for self-employed individuals will continue to decrease, dropping to €2,470 in 2025, and it will be reduced further in the coming years. These reductions increase the amount subject to tax, meaning self-employed individuals will pay more taxes..
If you inherit or receive a business as a gift, you pay inheritance or gift taxes depending on the value of the company. The BOR allows for an exemption if you meet three conditions:
- The company must be active (not just investments).
- The previous owner must have owned it for at least five years before gifting it or one year in the case of death (called the “ownership requirement”).
- You must continue the business for at least five years without selling the shares during that period.
If you meet these conditions, you receive a 100% exemption for businesses worth up to €1,325,253. For companies with a higher value, the exemption is 83% on the excess amount.
In 2025, the government proposes reducing the continuation requirement from five to three years, allowing the sale of the business after three years. Other changes to the BOR are planned for 2026.
The government plans to adjust the 30% ruling for foreign workers (expats) starting January 1, 2027. The proposal includes two measures:
- Compensation up to 27% of taxable salary: Expats who meet the requirements will be able to receive tax-free compensation of up to 27% of their taxable salary. In 2025 and 2026, the maximum percentage will remain at 30%. Those using the rule for five years will receive a greater tax benefit compared to the current regulations.
- Increase in income threshold: From 2027, the income threshold will increase from €46,107 to €50,436. For expats under 30 with a master’s degree, the threshold will rise from €35,048 to €38,388. These amounts will be adjusted in the coming years. This means fewer expats will qualify for the rule, and the maximum compensation some still eligible can receive will be reduced.
Additionally, the new rules will only apply to expats whose 30% ruling application is submitted after January 1, 2024. Those who started before that date will retain the 30% for five years and the current threshold.
The government believes these changes are less drastic and less harmful to the economy, maintaining the Netherlands’ appeal to expats.
- Road Tax
Electric or zero-emission vehicles will receive a 75% discount on road tax in 2025, meaning they will only pay 25% compared to conventional vehicles. However, in 2026, this discount will drop to 25%, and by 2029, these benefits will be eliminated. - Illness Deduction
People with disabilities or severe illnesses can deduct €0.23 per kilometer traveled by car when attending medical appointments or visiting relatives.
The government has proposed increasing the VAT rate in various leisure sectors. VAT for culture, books, and sports will rise from 9% to 21%. Similarly, the VAT for overnight stays will also increase from 9% to 21%.A gradual increase in the gambling tax is also planned. Starting January 1, 2025, the gambling tax will rise from 30.5% to 34.2%, and in 2026, it will increase to 37.8%. This measure will raise costs for gambling providers, and the government acknowledges that not all will be able to absorb this increase or pass it on to players.
The goal of these changes is to increase tax revenue. Starting in 2026, these measures are expected to generate an additional €202 million in tax revenue annually.
The government intends to reduce the energy tax rates on natural gas starting January 1, 2025. This reduction will apply to consumption of up to 170,000 m³ annually. In 2025, the new rate will be 2.8 euro cents per m³ lower than without this measure, offsetting a previous increase of 2.3 cents.
With this action, the government aims to ease energy costs for households. Energy providers will reflect these changes in their customers’ bills.
Prinsjesdag 2024 has unveiled significant tax reforms that will have a major impact on the lives of citizens and entrepreneurs in the Netherlands. These changes range from adjustments in income taxes and benefits for expatriates to modifications in the cultural, leisure, and transport sectors. The reforms aim to balance the tax system while promoting sustainability and protecting vulnerable sectors.
Source: Rijksoverheid, Belastingdienst, Kamer van Koophandel

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