On 15 November 2018, the House of Representatives passed all seven bills containing the 2019 tax plans. The ATADI bill was also passed. The bills will now go to the Senate. The Senate is not permitted to make any amendments to them. We consider the likelihood of the Senate rejecting one or more of these bills in their entirety to be very small.
Changes
We outlined the tax plans for 2019 in our article Tax plans 2019. Despite the efforts of various lobbies, the House of Representatives has made virtually no amendments. The only change made to the plans as originally submitted (which the Cabinet had already tweaked slightly here and there) is that:
- local authorities may apply the usually lower property tax rate for residential properties to sports facilities, village halls and other organisations serving the public interest;
- an exemption from waste tax will be introduced for the disposal of waste (containing) asbestos from asbestos roofs;
- Under the CFC rule, a country is considered to have a low tax regime if its corporation tax rate is at least 9% (previously 7%).
Volunteer
The amounts under the volunteer scheme are being increased. No payroll taxes need to be deducted for a volunteer who receives up to €170 (previously €150) per month and up to €1,700 (previously €1,500) per calendar year in allowances and benefits in kind.
A volunteer is someone who carries out their work on a non-professional basis for a non-taxable organisation or a sports organisation. The standard for this was that remuneration should not exceed €4.50 per hour (for volunteers aged 23 or under: €2.50). At the insistence of the House of Representatives, this limit is being raised to €5 per hour (it is not stated whether the hourly rate for young people will also be increased). This is rather unusual in itself, given that the House of Representatives had previously taken the view that social organisations should not be burdened with keeping track of the number of hours worked by their volunteers. In practice, however, this “hourly rate” is certainly a useful guideline.
Getting started!
Now that the House of Representatives has approved the bills, we can really get started on the announced measures. After all, the likelihood that the increase in the reduced VAT rate (6%, to become 9% with effect from 1 January 2019) will not go ahead is now very slim. The same applies to the flat-rate tax (37%), including the surcharge (from an income of €68,500, the rate is 49.5%) in Box 1 of income tax, whereby most allowable deductions must be calculated at the flat-rate tax rate. Furthermore, the announced (gradual) reduction in corporation tax rates can now be taken into account.
We would be happy to go through the measures and possible courses of action with you. Our end-of-year tips are a good place to start.