The Dutch cabinet has proposed a sweeping overhaul of the controversial box 3 wealth tax, set for implementation in 2028, alongside a multibillion-euro budget compromise that drops planned cuts to unemployment and disability benefits. Under the new proposal detailed by De Telegraaf on September 29, 2026, the tax system will shift to a total capital gains levy where taxpayers settle dues only upon selling investments or real estate. To help finance the abandoned benefit cuts, the cabinet is tightening rules for small business owners, lowering tax-free asset thresholds for savers, and trimming education budgets.
Box 3 Wealth Tax Overhaul Set for 2028
The updated cabinet proposal accelerates structural changes to box 3 taxation, targeting entrepreneurs and small retail investors to cover a more than €3 billion financial shortfall. Under the new rules, investors will pay tax on actual capital gains realized upon the sale of assets rather than fictitious returns. However, the tax-free return allowance drops from €1,800 to €1,000. The tax-free asset threshold will also fall steeply next year, dropping from over €60,000 to just over €30,000, forcing savers to settle accounts with the tax authorities much sooner.
Stricter Loan Limits for Box 2 Business Owners
Drawn-up restrictions for box 2 corporate structures mean business owners will face tighter caps on borrowing from their own holding companies. The tax-free limit for loans issued by a private company (bv) to its director-owner—excluding primary residence mortgages—will drop from €500,000 to €100,000. To offset these tighter rules and incentivize capital distribution, the cabinet plans a temporary reduction of the high box 2 tax rate to 29.2 percent, encouraging entrepreneurs to distribute higher corporate profits and boost treasury revenues.
Social Security Cuts Dropped to Secure Political Support
The multibillion-euro package resolves a major political deadlock by entirely scrapping planned reductions to unemployment (WW) and disability (WIA) benefit programs. National defense, justice and security, and infrastructure budgets are exempt from this measure, leaving nearly half of the required savings to be absorbed by the education budget. Left-wing parties and labor unions welcomed the concessions, with Klaver confirming support for the updated Social Security budget.
Changes to Labor Credits and Tax Brackets
Taxpayers will see minor adjustments across purchasing power metrics as the cabinet shifts several fiscal levers. The labor tax credit (arbeidskorting) will scale upward at a slower pace, while higher middle-income earners will enter the top income tax bracket at a later stage. The cabinet hopes ongoing talks with social partners will yield separate agreements to curb high inflow rates into disability schemes, potentially generating organic savings for public finances.
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