Government cuts back on employee perks

19th August 2004, Comments 0 comments

19 August 2004, AMSTERDAM — The Dutch government intends to cut two tax-free perks for employees to provide funds to support people on low incomes, it was reported Thursday.

19 August 2004

AMSTERDAM — The Dutch government intends to cut two tax-free perks for employees to provide funds to support people on low incomes, it was reported Thursday.

Sources close to the coalition cabinet say ministers have agreed to end the pc-prive-regeling and limit the spaarloon schemes to one per couple.

The pc-prive-regeling allows businesses to loan money to employees to buy a personal computer if they occasionally work from home. The tax-free amount employers could lend was reduced from EUR 2,269 to EUR 1,415 on 1 January this year.

Employees signed up to spaarloon schemes save a fixed amount deducted from their monthly salary and deposited tax-free in a savings account where it cannot be touched for several years.

People in the Netherlands often use spaarloon to help save for a deposit on a home or to buy a car.

Ministers have decided that two-income couples should be restricted to the spaarloon for one income only.

The government hopes to use the several hundred million euros it will save by scrapping the computer and savings perks to support people on low incomes.

Pensioners and parents on welfare are being hardest hit by the billions of euros in spending cuts scheduled to run until 2007.

The parliament still has to approve the Cabinet's plans and newspaper De Volkskrant noted that MPs have traditionally been strong supporters of the two perks.

Prime Minister Jan Peter Balkenende's first government abolished the spaarloon in 2002, but it was reprieved later following pressure from the coalition party, the Liberal VVD.

The reduction in the tax-free allowed under the pc-prive scheme also caused an outcry in parliament earlier this year.

Meanwhile, newspaper De Telegraaf reported Thursday it is likely the tax advantage for company vans will also disappear. Currently company fleets are exempted from BPM, the tax paid when registering a private car.

Tax minister Joop Wijn is said to want to scrap the grijs kenteken (grey registration plate) scheme to help pay for a reduction in corporate tax. Wijn wants to make the Netherlands more attractive to international businesses by reducing the tax on company profits from 34.5 to 31.5 percent next year, and 30 percent in 2007.

[Copyright Expatica News 2004]

Subject: Dutch news, working in the Netherlands

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