Key tax changes as of January 1, 2024

On Wednesday, December 19, the Dutch Parliament approved the Tax Plan 2024. This plan encompasses various measures aimed at supporting purchasing power and simplifying the tax system. Below is an overview of the main changes set to take effect from January 1, 2024.

Income

The Tax Plan 2024 introduces measures to increase the net income of workers, retirees, and most freelancers and entrepreneurs. Despite a minimal increase of 0.04% in the first tax bracket, the labor tax credit is raised by €115. However, entrepreneurs with higher incomes will face increased tax obligations due to the reduction of the self-employed deduction and the SME profit exemption.

Additionally, tax-free commuting allowances and volunteer allowances are increased to €0.23 per kilometer and €5.50 per hour for volunteers aged 21 and older.

Business

As of January 1, the second bracket in box 2 comes into effect, with a 24.5% tax on the first €67,000 of income. Furthermore, the 30% ruling and the option for tax-free gifts for home purchases are restricted.

Wealth and Housing

The tax rate in box 3 rises from 32% to 36% as of January 1, 2024, while maintaining the tax-free threshold at €57,000. The starter's exemption for homes is increased to €510,000, and tax-free gifts for home purchases are no longer possible.

The cost reimbursement in the event of objection or appeal regarding WOZ or bpm is transferred directly to the citizen or business and reduced to 25% if the objection is successful.

Climate

The reduction in energy tax, the fixed amount deducted from the energy bill per connection, increases to €631.39 per year. From July 1, passengers on most private planes will pay aviation tax due to a weight limit reduction from 8,616 kilograms to 4,000 kilograms.

Fuel Excise

To further support purchasing power, the fuel excise rates in 2024 remain the same as of July 1, 2023.

Health

Consumption tax on alcohol-free drinks increases to €26.13 per 100 liters, with mineral water exempt. Excise taxes on alcohol and tobacco are raised by 8.4% from 2024. As of April 1, the excise tax on cigarettes is €7.81 per pack of 20, and the excise tax on rolling tobacco is €17.35 per pack of 50 grams. A pack of cigarettes (20 pieces) will cost an average of €11.10, and a pack of rolling tobacco (50 grams) will cost €24.62, including VAT.

Rijksoverheid.nl