Possible widening of corporate income tax base

The coalition parties propose to amend the so-called 'Controlled Foreign Company' (CFC) rules following recommendations by the advisory committee on taxation of multinationals. Under the existing CFC-regime, income from entities in certain low-tax countries is included in the Dutch taxable income. In 2020, the advisory committee proposed to tighten the current CFC-regime, for example by abolishing the currently existing exception for interim distributions of profits and by increasing the threshold of the ‘real economic activities-exception’.

The coalition parties also confirm that they will implement the Pillar Two proposal of the OECD as agreed by a majority of countries. In short, Pillar Two seeks to enforce a minimum effective tax rate of 15% in each jurisdiction where an MNE group realises profits. This measure might take effect from the year 2023. For further background on Pillar Two we refer to our latest news item in this respect.

The coalition agreement describes that, in the event that the adjustments to the CFC-rules as well as the implementation of Pillar Two do not generate sufficient tax revenues, other measures will be examined to broaden the corporate tax base. Other measures could include adjustments to the low corporate income tax rate (15% as of 2022) and the associated bracket of profits (the low rate will apply to profits up to EUR 395,000 as of 2022). In this regard it is stated that a sound business climate will be taken into account.

Increase of real estate transfer tax rate

The coalition agreement includes plans to increase the rate of transfer tax for the acquisition of (i) non-residential property and (ii) residential buy-to-let property, from 8% to 9%, effective 2023. With this measure, the coalition parties want to create room on the housing market for non-investors.

Abolition of landlord levy

Housing corporations and other corporate tax payers who own more than 50 rental homes, of which the monthly rent does not exceed the so-called rent allowance limit (€ 752.33 in 2021), currently pay an annual landlord levy. The coalition parties have announced that they will abolish the landlord levy as of 1 January 2023 in order to give housing corporations the financial scope to build social housing and make existing housing more sustainable in the coming decade.

Budget increases for certain investment allowances

Companies that invest in energy-saving assets or sustainable energy can make use of the so-called Energy Investment Deduction (EIA). By applying the EIA, companies can deduct 45.5% of the investment costs from their taxable profit, under certain conditions.

In addition to the EIA, the Environmental Investment Deduction (MIA) offers companies an additional deduction possibility to reduce the taxable profit for investments in certain innovative and environmentally friendly business assets. On Budget Day 2021, the caretaker government announced that the percentages of the MIA will be increased as of 1 January 2022 from 13.5%, 27% and 36% to 27%, 36% and 45%, respectively.

The coalition parties intend to structurally increase the budgets for the EIA and MIA as of 1 January 2023 by EUR 50 million and EUR 30 million, respectively.

For the sake of completeness, we note that the coalition agreement contains more sustainability related measures which are not addressed in this communication.

No proposals announced to change the innovation box

Profits from innovative activities can, under certain conditions, be taxed in the innovation box, instead of the regular corporate income tax regime. In recent years, the innovation box tax rate has been gradually increased from 5% (2017) to 9% (2021). The coalition agreement does not describe any intended changes to the innovation box.


The plans may change in the coming years, or new plans may be introduced during the term of the new government. The coalition agreement is also an outline agreement that leaves room for further elaboration. Moreover, given the fact that the coalition parties do not have a majority in the Upper House, further changes may be expected as a result of political negotiations.


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