Netherlands to lower inheritance tax
A proposal by Deputy Finance Minister will see an increase in tax threshold on inherited wealth for partners and children and lowering of rates of inheritance tax.THE NETHERLANDS – Inheritance tax in the Netherlands will be significantly lowered if a proposal submitted by Deputy Finance Minister Jan Kees de Jager is approved by upper and lower houses of parliament.
The minister recommends the tax threshold on inherited wealth for surviving partner to be increased to EUR 600,000 and for children to EUR 19,000.
The rates of inheritance tax will be lowered with family members paying a maximum rate of 20 percent and non-relatives paying a maximum rate of 40 percent.
The current limit is EUR 500,000 and the current tax rates for family members and non-relatives are 27 percent and 68 percent respectively.
Ministers agreed to the changes six months ago, and the plans will now be voted on by the upper and lower houses of parliament. If approved, they will become law on 1 January.
The overhaul in inheritance tax is a response to less revenue collected in 2008 from tax on inheritance and bequests. Figures from Statistics Netherlands (CBS) show the treasury received EUR 1.8 billion from probate duty, four percent less than in 2007.
The CBS suspects an increasing number of people are avoiding inheritance tax by passing wealth on to their children before they die. The downward trend in inheritance tax receipts is set to continue in 2009.
A number of exemptions to those subject to the tax have been announced for 2009. These include sport associations and community centres which do not have to pay any tax on bequests and inherited money.
Radio Netherlands / Expatica