VVD will not support the tax plan if left-wing "Millionaire's Tax" amendment makes it in
The VVD will not support the 2027 tax plan if the watered down version of an amendment from opposition parties PRO and Volt passes the Tweede Kamer, the lower house of Parliament. The modified amendment was the result of negotiations with Prime Minister Rob Jetten's D66 and coalition partner CDA, but without the approval of the third coalition party, VVD. Their Tweede Kamer faction chair, Ruben Brekelmans, said in Parliament on Thursday that he agrees with party leader Dilan Yesilgoz that the coalition will need a "fundamental reset" if the amendment passes, though he did not elaborate on what that would could mean.
“I was caught off guard by my coalition partners. This is a deal that the VVD cannot support. It is harmful to entrepreneurs and our economy, and it runs counter to our coalition agreement,” Brekelmans said. He added that he cannot tell the D66 and CDA how to vote. “Ultimately, every party is free to vote however they choose. I cannot demand anything; I can only express the VVD’s perspective on the matter.” He repeated that the VVD will not support the tax plan with that amendment attached to it.
After months of fruitless negotiations with the opposition parties to find support for the minority cabinet’s tax plan, the parliamentary leaders of the coalition parties decided to approach the opposition separately. On Wednesday, the D66 and CDA announced that they’ve come to an agreement with left-wing PRO and centrist Volt to shift €1 billion of the burden from tax increases and subsidy changes affecting working class households to taxes on wealth. A clear compromise, as the opposition parties originally proposed shifting €1.5 billion.
The VVD is firmly against taxing businesses and wealth more heavily, despite demanding increased defense spending, and has historically been firmly against working with left-wing PRO, particularly the further left GroenLinks portion of the faction. The VVD was furious after the deal was announced. Later on Wednesday, VVD leader Dilan Yeşilgöz, the current defense minister, hinted that the coalition may not survive this update.
“It is not without reason that our party leader, Dilan Yeşilgöz, stated yesterday that, in our view, a 'fundamental reset' is necessary,” Brekelmans said. “The way things have unfolded over the past few months, and specifically what happened yesterday and the day before, is simply not how parties can work together. So, as far as I am concerned, a fundamental reset is truly required, especially regarding how parties cast their votes here.”
The leader of hard-right party JA21, Joost Eerdmans, wanted to know from Brekelmans exactly what he means by a “fundamental reset.” The VVD MP said that there needs to be a discussion about the way forward. "What will come of that, and what the next steps might be—that remains to be seen. I am not going to rule out any specific options in advance. Perhaps an interim formation process is needed, or maybe D66 would prefer to form a coalition with PRO. I’m not going to jump to any conclusions."
Earlier this week, a majority in parliament passed a motion to restart the formation process without holding yet another election should the Cabinet collapse. If it comes that far, the VVD will likely support that, as it is currently losing ground in the polls. The same is true for the other two coalition parties.
After Brekelmans concluded his portion of the debate, CDA leader Henri Bontenbal took the microphone. He started by saying that the coalition agreed on overhauls to many political issues previously mired in a stalemate as part of the coalition agreement. But their tax plan proved unpopular with no real pathway to a majority vote in either parliamentary house. Meanwhile, "the clock keeps ticking," as the Tax Authority needs time to be able to implement the changes Bontenbal said. Not having a tax plan in place would cost the Netherlands billions.
Bontenbal said that, after “tough but respectful” negotiations with PRO and Volt, the CDA and D66 were able to come to an agreement that would get the left-wing parties' support without changing too much about the coalition’s plans. The PRO and Volt amendment involves increasing taxes and freezing inflation indexing to add €1 billion in revenue collected from wealthier households, while simultaneously reducing the tax burden by €900 million on middle class and lower class households.
He argued the change is important, but not shocking when considering the current coalition plan aims to collect €451.4 billion in revenue. “Working together does not mean abandoning your own positions. It means bringing your own wishes and viewpoints to the table, while also listening to those of the other side - and then arriving at a compromise for both parties,” Bontenbal said.
The government’s tax plan “incorporates many wishes from various opposition parties - from the right and the left to the center,” Bontenbal said. “However, we also knew that it lacked a majority in both [the Tweede Kamer and the Senate] - no stable majorities.”
In his address to parliament an hour earlier, D66 leader Jan Paternotte pleaded for cool heads. The D66 still wants to “make a success” of this Cabinet, even though things have not gone smoothly of late. “So I believe we share a responsibility to carefully examine how we can bring about a turnaround and ensure that we approach things differently next year.” He firmly denied surprising the VVD with the deal, saying that the coalition pirates have been “very transparent with one another.”
There is a significant chance that the tax plan will fail without the VVD’s support. D66, CDA, PRO, and Volt are still 11 seats short of a majority. They will need the support from several smaller parties, across a broad range of the political spectrum, such as DENK (3), 50Plus (2), ChristenUnie (3), PvdD (3), and SP (3).
The four parties have 29 senators n the Eerste Kamer, the upper parliamentary house. They could potentially find seven votes to gain a true majority by garnering support from SP (3), ChristenUnie (3), PvdD (2), 50Plus (1), or any of the six other single-seat parties.