Defense spending will increase to 2 percent of gross domestic product in 2024 and 2025. This is evident from the announcement of the Spring Memorandum on Friday. The minimum wage will also increase: by 7.5 percent in three annual steps from 2023. The Dutch budget deficit will rise to 3.4 percent, exceeding the European standard of 3 percent. Expenditures are offset, among other things, by a tax increase for the higher incomes and companies in boxes 2 and 3 and by a higher corporate tax.
The government wants to increase defense spending to meet the NATO standard, partly prompted by the war in Ukraine. There was a great demand from the House of Representatives for extra money for the armed forces. The amount of the state pension will increase in the same steps with the new minimum wage, contrary to what the cabinet initially planned. The two rise a year earlier than agreed in the coalition agreement.
The Spring Memorandum also states that people who have objected to the excessive tax paid on savings will receive this amount back. The Supreme Court ruled on Friday that this does not automatically apply to people who lodged an objection with the Tax Authorities too late or who did not object.
backrooms
The Spring Memorandum is normally only an adjustment to the budget of the current year. Due to the major influence of the war in Ukraine on the Dutch economy and budget, this year it also provides a preview of the budgets for the coming years. Inflation as a result of the war has risen to a record high and is affecting low and middle incomes in the Netherlands.
Also read this article about how Rutte and Kaag in the discussions about the Spring Memorandum went to the back rooms
Prime Minister Mark Rutte (VVD) and Minister of Finance Sigrid Kaag (D66) sought out more backrooms in the discussions about the Spring Memorandum than in previous years. This is despite the new administrative culture proposed by the Rutte IV cabinet, which has never really allowed itself to be defined, but which is often mentioned in combination with promises such as ‘more transparency and openness’. According to Rutte, the conversations behind closed doors were “inevitable.” “And then it is of course up to the opposition parties whether they want to participate or not,” he said earlier.