The debate over how to tax Box 3

The debate over how to tax income in Box 3 will not die down, and as is so often the case, the "improvements" raise even more questions than the previous flaws did.

For years the Dutch complained about the old system, which taxed a fictitious income that the state itself made up. The result was that people with low real income (for example, savings in deposit accounts) paid too much.

Now we are faced with having to pay tax on capital income that exists only on paper.

The Tweede Kamer has already approved the reform bill, which is under fire and meeting resistance in the Eerste Kamer. Because of this, the Minister of Finance announced that he is willing to revise the law to keep it from failing in the Senate.

In short, in 2028 they plan to introduce vermogensaanwasbelasting (a tax on the increase in value), and from 2029 the coalition wants to move to vermogenswinstbelasting (a tax on realised gains).

Vermogensaanwasbelasting is a tax on real income (interest, dividends) and on the unrealised growth in the value of assets (shares, crypto, real estate), even if they have not been sold.

Vermogenswinstbelasting is a tax on realised gains — you pay only when you sell the asset and receive actual income.

The greatest resistance and outrage is caused precisely by the requirement to pay tax on a difference in value that is not a real, realised gain.

An article by three tax experts (Ruud van den Dool, Aart Gerritsen en Bas Jacobs) is circulating online, and they actually defend vermogensaanwasbelasting. I invite you to weigh up their arguments for yourself.

The academics argue that, despite the criticism, taxing the increase in asset value at the moment it grows (vermogensaanwasbelasting) is the best model for the new Box 3. And the alternative — vermogenswinstbelasting (a tax on the capital gain upon sale) — creates significant economic distortions.

After all, under vermogenswinstbelasting:

• the taxpayer decides for themselves when to sell the asset;
• deferring the sale leads to deferring the tax, and through that you earn additional income on the "untaxed" amounts;
• this creates a fiscal advantage that has no economic justification.

And such undesirable behavioural reactions the state simply cannot allow.

Under vermogensaanwasbelasting there is no point for people in postponing the sale of assets; there is no way to "play" with the timing of realisation.

And in general, under a vermogenswinstbelasting system the rates would have to be raised to compensate for the losses from deferral; whereas this way lower rates can be set.

(Whatever tax reforms take place, a common thread running through tax officials' comments is the thought: "Well, here we lowered/deferred, so over here we raised and sped things up.")

On the whole, the problem with these arguments "in favour" is that they work only in economic models — when economists say that this system creates neutrality and removes any manipulation of the timing of a sale, they ignore people's real behaviour. In real life assets are not valued for free, liquidity does not just appear out of nowhere, and volatility is not smoothed out mathematically.

Moreover, the arguments "in favour" are mostly the state's arguments, which guarantee stable revenue for the budget. For the taxpayer the benefits look very abstract.

Opponents and supporters of vermogenswinstbelasting (the tax on realised gains) put forward their own remarks and warnings about the vermogensaanwasbelasting system (the tax on the increase in value). The main practical argument is that taxing unrealised gains is a tax on money the person does not have.

This creates the need to sell assets solely in order to pay the tax, and pressure on long-term investments. So the system would penalise long-term investors — the longer you hold the asset, the more times you pay tax on interim "paper" increases. High volatility makes annual taxation unfair, and it hits especially hard investors with risky assets, investments in innovation and start-ups. At the same time the tax encourages taking on even more risk to offset the tax pressure. Valuing assets every year increases bureaucracy and leads to more errors and disputes. The model works poorly under inflation: if an asset has grown by 5% while inflation is 4%, then the real gain is 1%. But the tax is charged on the full 5%. Most countries do not tax unrealised gains and use precisely vermogenswinstbelasting. It is simpler, fairer, more predictable, and does less harm to investment.

To sum up, the arguments against vermogensaanwasbelasting are these:

• it is a tax on money that does not exist;
• it creates liquidity risks;
• it is unfair in volatile markets;
• it penalises long-term investors;
• it harms start-ups and innovation;
• it is complex and expensive to administer;
• it contradicts international practice;
• it is unstable in crisis years;
• it taxes potential rather than real income.

As of March 2026, the government is NOT abandoning vermogensaanwasbelasting in 2028:

• the Box 3 reform takes effect in 2028,
• it will be the taxation of real annual income (aanwas),
• they are considering adding a backward (achterwaartse) loss carry-back of 1 year from 2029.
• the Belastingdienst is currently assessing whether its IT system can even handle this.
• the strategic goal is the transition to vermogenswinstbelasting,
• for start-ups and scale-ups there will be a separate, better definition.

For now we are watching how events unfold and will keep you informed of the news and changes.