Recently, Sijbren Cnossen, Professor Emeritus of Tax Law at Erasmus School of Economics, and Peter Kavelaars, Professor of Economics of Taxation at Erasmus School of Economics, appeared in an article by De Telegraaf to give their expertise on the box 3 system. According to them, the Netherlands could take an example from abroad for the design of that system.
The debate on the taxation of income from assets continued into 2024. Following a critical opinion from the Council of State, the finance ministry once again faced the challenge of developing a future-proof box 3 system. While many countries choose to tax capital gains only when they are realised, the ministry had a different proposal: a capital gains tax. This system would mean annual taxation on the growth of assets, such as savings and investments other than real estate, regardless of whether these gains were actually cashed in.
This is undesirable, according to Cnossen. He argues that the Netherlands should especially look to Scandinavian countries, where capital gains are taxed at a ‘moderate, uniform rate’. ‘These countries add that realisation is assumed upon death, migration or donation.’ This means that heirs pay capital gains tax as soon as they inherit assets. Kavelaars agrees, and argues that a capital gains tax will not possibly lead to lawsuits as it did now, whereas a capital gains tax will (again). 'The biggest problem now is that people are paying on money they did not have. That problem is not there with a capital gains tax anyway.'
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You can download the full article from De Telegraaf, 4 January 2025, above.
