Peter Kavelaars, Professor of Economics of Taxation at Erasmus School of Economics, has been a guest on a radio programme by BNR Nieuwsradio. Here, he spoke, among other things, about tax inequality between rich and poor, our tax system and how capital income should be taxed.
Extremely rich people pay relatively less tax than middle- and low-income people. This is because these are taxpayers who have their money in a company because that is where their business is. As soon as they do not take their money out, they cannot be taxed. In principle, they could get much more income out of profits but so they don't. So that 1% of the Dutch is about 140,000 taxpayers. Fictitious dividends have sometimes been proposed as a solution, but then you would be taxing fictitious income and you don't really want that according to Kavelaars.
Our tax system is very similar to other countries, but it is still a tricky system. Box 3 is a good example of this. Real capital income will be taxed in new system in 2027-2028. In the meantime, other system, which people have started litigating about again and that's back at high court. Then the current system might fall away again, so that's an inconvenience, because otherwise no tax can be collected. The best solution, according to Kavelaars, is to bring forward that new plan. The big pain point in the new system is that asset increases or decreases must also be taken into account. Are you going to do that when you realise it or already tax it at the end of the year when there has been an increase in the value of your shares. State secretary now wants the latter, but Kavelaars doesn't think that's a good idea. Then you start taxing things that have not yet been realised.
With real estate, this is the plan now, but this should also be extended to other assets. Kavelaars would introduce capital gains tax as soon as possible, reduce tax on labour a bit as it encourages work. One solution is to tax energy and the environment more heavily, as these are polluting components. At the European level, though, excise taxes on cruise ships and aeroplanes are now coming.