Council of State calls 2028 box 3 wealth tax unworkable, urges 2030 start

Council rejects the 2028 start

The Council of State (Raad van State), the cabinet's main legal adviser, has issued a sharply critical opinion on the plan for a new wealth tax in box 3. It advises the cabinet not to submit the current proposal, which would take effect in 2028, and to take time for a new bill that could apply from 2030. The Council objects that the cabinet treats different asset types differently and applies two separate tax systems to them without a clear justification. Under the plan, crypto assets would still face a tax on accrued value until 2030.

The Council also objects to the route itself. It says that introducing the change through a novelle, an amendment to a bill already stalled in the Eerste Kamer, rather than a full bill, weakens the careful lawmaking process and carries risks for the bill's quality.

“This also has negative consequences for the quality of the bill and for the implementation.”

Implementation problems and bank warnings

The Council's concerns echo those raised in recent months by civil servants under Finance Minister Eelco Heinen and State Secretary Eelco Eerenberg. The tax authority's own implementation test called the amendment 'onuitvoerbaar' (unworkable) and 'niet verantwoord' (not responsible) at least for 2028. The Council puts the extra cost at 252 full-time staff and about 31 million euro in additional implementation expenses. The adjustment of box 3 is said to cost about 18 billion euro over the next ten years.

The Dutch Banking Association wrote to the House of Representatives on Thursday, 29 October, warning that investors may not be able to supply all the data needed for box 3 tax due in 2028. Private individuals would then have to look up figures themselves, and the new return is far more complicated than the current, largely pre-filled box 3 return, so banks expect many errors. The tax authority has said it can hardly check returns, and it considers correcting errors and detecting deliberate underreporting for tax year 2028, and probably 2029, close to impossible.

“Legislation coming about in this way undermines the legislative process.”

Cabinet response and political stakes

The cabinet announced in September that it would move to a full wealth gains tax from 2028, covering savings, shares and property, and the plan was only finalised at the end of September. Telegraaf reports that Heinen had already rejected an earlier version and that the cabinet had no agreed alternative before Prinsjesdag. Within the cabinet, a 2028 start is still preferred, though a one-year delay is being cautiously considered. NOS reports that Heinen still aims for 2028, while the Council wants a solid bill with a later start.

Nearly all political parties want to change how wealth is taxed, so that owners pay only when assets are sold or cashed in rather than annually on a notional return. The change would cost the government many billions in the first years, and no agreement exists yet on how to finance it. The bill is stuck in the Eerste Kamer. Under the Council's preferred route, the existing bridging law would stay in place, letting taxpayers object through a counter-evidence scheme when they paid more tax than their actual return. NOS reports that whether the minority cabinet presses ahead will become clear in the coming days during negotiations on the tax plan.