May 18, 2022

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The coalition must look for an additional 10-15 billion euros for a series of setbacks

The coalition must look for an additional 10-15 billion euros for a series of setbacks

In the coming days, the coalition parties will be looking for a cover of 10-15 billion euros in setbacks. The four government parties are preparing the spring memo and this week will consider where they will get the money. But any solution is politically controversial.

This includes billions of euros in purchasing power, savings tax and AOW. The new is a setback of €1 billion per year due to the new corporate tax for multinational corporations canceledAccording to sources in The Hague. That’s because Poland voted against the EU’s corporate tax deal last week.

Taxes for major shareholders

The government had already relied on this money in its financial form, but that would no longer be available. To compensate for this, a tax increase is being considered in “Box 2”. It’s about the major shareholder tax paid by many entrepreneurs, from notaries to people who own a butcher shop.

This is exactly where many political leaders are also looking for money for their largest cost component: the savings tax (“box 3”). This is the tax on savings. After a court ruling, the Cabinet must compensate savers. Sources in The Hague assume a one-time bill of €7 billion.

Money from the National Growth Fund

Then a few more billions should go to the Department of Defense. The idea is that this should be paid for from the funds earmarked for the National Growth Fund, also known as Wopke Box / Wiebes call. The government was planning to deposit 6.7 billion euros there, but that appears to have been abandoned.

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Then the state pension. The House of Representatives believes that the old-age pension should be full, contrary to the plans of the Council of Ministers Increase with minimum wage† Costs are estimated at €2.4 billion annually. A cover should be found for that, too. There are also desires, for example, to allocate more money to youth care and nursing homes.

purchasing power

Then there is of course the purchasing power. In this time of war and Unprecedented inflation The government wants to absorb middle-income and especially low-income people. An additional 3 billion euros have been made available for this purpose in recent months. The desire is to do more for it in the coming period, but the rich in Holland will have to pay for it.

“If you want to do something for the vulnerable, it means redistributing the money within the Netherlands,” says Minister for Social Affairs Van Jennip. So others will have to pay for it.

rich dutch

Therefore, the government is also looking at the richer Dutch: should they pay more taxes? D66 and ChristenUnie actually wanted this on the negotiating table in government formation, but the VVD held it back. Now that bills have accumulated in a few months, that debate will resume.

The alternative is to cut spending or allow the national debt to rise further. But most parties don’t wait for that either.

This week the coalition parties will be talking about coverage. The Spring Memorandum must be submitted to the House of Representatives no later than June 1.

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