The Netherlands is poised to approve a change to the income tax that will impose a 36% tax on unrealized gains, as it seeks to boost revenue to fund government activities. Of course, confiscatory taxes have never worked anywhere and will likely have the opposite effect, as the affluent and innovators migrate to more business-friendly jurisdictions.
The Dutch Parliament has yet to pass the new taxes into law, but expectations are that they will take effect by 2028.
According to NL Times, the goal is to target stocks, bonds, and crypto. Investors must pay tax on unrealized gains each year, even if they have not sold or realized any gain. While elected officials are said to view the plan as flawed, they still intend to support it as tax revenue declines due to stagnant wages and muted economic activity. The country already assesses a top personal income tax of 49.5%, which is higher than the OECD average.
In 2024, a survey in the Netherlands indicated that 20% of entrepreneurs were considering leaving the country due to taxes, regulations, and a poor business climate.
Another study from the same year indicated that a growing number of companies plan to leave the Netherlands due to anti-economic policies pursued by politicians.
Two of the best-known Dutch firms have already fled the Netherlands. Shell plc officially moved its headquarters and tax residency from the Netherlands to the UK in 2021. Unilever became a UK company in 2020.
In 2024, 208,537 people emigrated from the Netherlands.
