Cabinet wants to help working poor with tax rebate

The cabinet is considering introducing a tax rebate for workers next year. It is a measure to accommodate the ever-growing group of Dutch people who do not have enough left to make ends meet. Thats what sources tell DecceIt.

The tax rebate is intended to give people with low and medium income a little more room, because they have to pay less tax. Specifically, it concerns adjusting the labor discount for the lowest incomes, leading to a higher salary. In August, the cabinet took a knot about this. People would not notice about it until next year.

The measure also aims for part-timers to work more hours, as a contribution to resolving staff shortages. Something that is desperately needed in these times of tightness in the labor market. Previous research shows that 30 percent of the working poor would want to work more hours if the labor discount is increased.

Further increase minimum wage

In addition, the cabinet is considering raising the minimum wage one step further. This will also be decided in August. This increases the purchasing power of the lowest incomes.

The government parties had already decided to raise the minimum wage, but even with that increase, it remains under the European directive. The new minimum wage comes to 12.11 euros, according to the advice from Brussels, another 2 euro should be added.

Taxi driver Suzanna was happy about that possible raise, she said earlier this week: I jumped a hole in the air of course:

The Central Planning Bureau issued a report today where 1.2 million households are in financial trouble in the darkest scenario because of all the price increases. The lower incomes, in particular, would drop through the lower limit.

Power Inequality

The cabinet is thinking of paying the measures with the 2.4 billion euros set aside in the spring memorandum for a burden relief for middle incomes.

In addition, it is looking at whether wealthy people should pay more taxes. There is a large-scale investigation into the wealth inequality in the Netherlands. That must be done before the summer. This will be discussed in August without political taboos, Prime Minister Rutte said today in the Accountability Debate.

Some government parties hope that with this research, it will be possible to look more closely at where wealthy people now pay little or sometimes no tax.

If you look through your eye hairs, you could say that income in the Netherlands is going tidy, but if you look at the wealth inequality, there seems to be a certain skew growth, says Rutte.