Netherlands: Payroll tax, wages, salaries tax proposals | KPMG Global
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Netherlands: “Budget day” payroll tax, wages and salaries tax proposals

Netherlands: Payroll tax, wages, salaries tax proposals

In the Netherlands, on “budget day” (19 September 2017), the caretaker Cabinet presented a package of measures for the 2018 tax plan to the Lower House that include proposals for changes to payroll taxes.


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There are also proposals to changes to the wages and salaries tax and to national insurance contributions reduced remittances law (Wet vermindering afdracht loonbelasting en premie voor de volksverzekeringen), as laid down in the 2018 tax plan and other tax measures for 2018. The proposed changes generally would be effective 1 January 2018.

There are also measures concerning the partial exemption for the taxable benefit derived from share options of start-ups (as adopted in 2016 as part of the 2017 tax plan) and the salary costs (incentive allowances) provisions (Wet tegemoetkomingen loondomein), part of which will take effect 1 January 2018. 

Tax rate proposals

  • The individual (personal) tax rate in the second and third payroll tax and individual income tax brackets is 40.80% in 2017. As of 1 January 2018, the tax rate in both brackets would be increased by 0.05% to 40.85%. 
  • The tax rate in the fourth payroll tax and individual income tax bracket is 52% in 2017. It would be reduced by 0.05% to 51.95% as of 1 January 2018. 
  • The brackets would be extended—meaning that in 2018, the fourth bracket would begin with taxable income of more than €68,507. 
  • As of 1 January 2018, the combined tax rate in the first bracket would be 36.55% (the same as in 2017).


Read a September 2017 report prepared by the KPMG member firm in the Netherlands

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