Support for tax plan stil uncertain as coalition squabbles about taxing the wealthy

It remains uncertain whether the Cabinet will manage to get enough support for its tax plan for next year. During a parliamentary debate on the matter on Wednesday, the coalition parties squabbled over whether to accept a PRO and Volt amendment that would tax the wealthy more heavily, with the D66 supporting the idea and the VVD being vehemently against it. Support from PRO and Volt would give the minority Cabinet a majority in both parliament and the Senate.

PRO and Volt want to shift €1.5 billion from taxing workers to taxing wealth. A portion of this, €180 million, would be generated by abolishing a tax advantage arrangement for the transfer of a business. The Jetten I coalition agreement explicitly states that this arrangement would be left untouched.

Coalition party D66 is open to talking with Pro and Volt about their proposal. “I understand the direction,” D66 MP Henk-Jan Oosterhuis said about the plan.

But coalition partner VVD refuses to contradict the coalition agreement. “It is inconceivable that any of the coalition parties would support this proposal in its current form,” said VVD MP Wendy van Eijk. Beyond conflicting with the coalition agreement, she argued that the left-wing parties’ “millionaire tax” would harm the business climate and, by extension, the Netherlands as a whole.

CDA MP Inge van Dijk called the left-wing opposition’s proposal “far-reaching,” and couldn’t say whether her party might support it. But CDA leader Henri Bontenbal remarked on Tuesday that he was unhappy with the Cabinet “gambling” on securing a majority for the tax plan. He criticized the VVD for being too rigid on the taxation of wealth.

PRO leader Jesse Klaver said in parliament that he had “gone to great lengths” with this proposal. He will accept that income tax for workers will rise, though the PRO and Volt amendment would mitigate this somewhat. “It is an attempt to make things fairer. Everyone should contribute, not just those who work.” He said he was open to negotiating the specific details.

The coalition parties have not ruled out the possibility of split voting, though CDA MP Van Dijk stressed that this was “certainly not the intention.” According to NOS, insiders say the VVD may vote against the portion of the tax plan that involves taxing the wealthy, while accepting that the D66 and the CDA will support the proposal, bringing it to a majority. During the debate, the coalition parties refused to answer questions regarding this possibility.

The coming days will doubtless involve a lot of negotiating, and therefore potential changes to the plans. The votes on the tax plan are scheduled for November 12.