The 30% facility is a tax advantage meant to attract highly-skilled migrants to the Netherlands. Under the ruling, employers can grant a tax free allowance equivalent to 30% of gross income for 8 years. But as of January 1, 2019, the policy will be reduced to 5 years, according to the Ministry of Finance. The government has reduced the policy allowance before, from 10 years to 8 – but expats already in the Netherlands were grandfathered in the original allowance. Not this time.
‘Instead of doing the rational thing and changing the policy for future expats, the change will be RETROACTIVE, negatively impacting thousands of expats”, explains the petition published in Change.org. The petition urges Dutch lawmakers to only apply the changes to expats who come to country after the law is in effect.
The University of Groningen currently employs more than 1,200 internationals, many of whom will be affected by the measure. Ryan Mitchell Wittingslow, an Australian Assistant Professor in Humanities at the University of Groningen, considers the measure ‘deeply unfair’. It will force him to change his financial planning, he says.
Three years ago he came to the RUG with assurances that he would be under an advantageous tax regime for 8 years – an advantage that entered significantly into his decision to come to the Netherlands. which obviously made it very appealing for him, But now he must reconsider his plans to stay.
‘I have a mortgage, and the structure of my mortgage is premised upon having the 30% tax facility for 8 years. If they change it to 5, that jeopardizes my ability to finance my mortgage, which is pretty outlandish’, says Wittingslow.
The University is aware of the situation but can’t do much to reassure international staff. ‘For now all we can do is wait for the government’s decision – the employees will be informed’, says Miranda Tel-Postma from the Human Resources Department.
Internationals are not the only ones expressing discontent with the changes. The Dutch employers’ federation (VNO-NCW) says on their website that the ruling change negatively affects businesses as well.
‘A reliable government is essential for the business climate. The shortage makes the Netherlands less attractive to other countries’, says the VNO-NCW. ‘Attracting foreign talent is not getting any easier – while that talent is needed in a tightening labor market.’
Handshake deals and broken promises
Commenters on the petition feel they have been deceived by the Dutch government. ‘What a terrible message for future skilled workers: come and work in the Netherlands, but don’t rely on any tax benefit the Dutch government uses to lure you in – they can take them away as they please. Now you have them, now you don’t!’, comments Natalia Lowe, from Amsterdam.
Sonia Mangwana, from India, agrees. ‘In a country where handshake deals are considered binding, it’s frustrating to see the government going back on its promise of the 30% ruling to existing expats here. Seems almost illegal doesn’t it?’