Kingdom of the Netherlands—Netherlands: Selected Issues

International Monetary Fund

No 2016/046, IMF Staff Country Reports from International Monetary Fund

Abstract: This paper aims to contribute to the discussion by sketching ways in which the taxation equity-efficiency frontier could be shifted outward in the Netherlands. In a nutshell, we argue that significant efficiency gains could be achieved by shifting the tax burden away from labor, and toward consumption and capital—especially housing. The detrimental impact of the tax-benefit system on labor supply—in particular by mothers—and the insufficient and distortionary use of the value-added tax (VAT) as a revenue-collection mechanism is also highlighted in the paper. This paper also reviews the main features of the Dutch tax system and sketches the contours of a hypothetical tax reform.

Keywords: ISCR; CR; earnings; income; income tax; rate; self-employed contractor; net earnings; solvency ratio; freelance worker; pillar II pension; risk pooling; Self-employment; Pensions; Pension spending; Personal income; Wages; Global; Europe (search for similar items in EconPapers)
Pages: 45
Date: 2016-02-11
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