Proposed adjustments in Tax Legislation BES will probably not have much impact on average tax payer

THE HAGUE/KRALENDIJK – State Secretary of Finance Marnix van Rij (CDA) is preparing amendments to various provisions in the BES Tax Law. Van Rij intends to request urgent advice on the adjustments from the Council of State, after which the changes will be presented to the Second Chamber (Tweede Kamer) for implementation per January 1, 2024.

For the average citizen, not much is expected to change. However, there are a few thorny issues for hotels and business owners, in particular. 

One noticeable change is the increase in the Real Estate Tax (Vastgoedbelasting) for hotels from 10% to 12.5%. While this might not seem substantial, it still constitutes a 25% increase, which is significant.

An adjustment is also being made to the yield tax rate, doubling it from 5% to 10%. What’s particularly striking here is the reasoning for the increase: to finance the increase in the tax-free amount in income tax, which was raised as of 1/1/2023.

Usual Salary

What entrepreneurs will particularly struggle with is the increase in the so-called usual salary (Gebruikelijk Loon). This refers to the salary that managing directors/major shareholders are required to pay themselves.

There are also a few proposed relaxations. It’s intended that connected businesses no longer need to pass on each incurred turnover tax (ABB) to one another.

Unknown

Interestingly, the content of the proposed amendments is hardly known on the islands themselves. For various politicians, the announcement of forthcoming changes in the BES tax law is unfamiliar.

You can find the full text of the proposed amendments here.

https://open.overheid.nl/documenten/ronl-dd9782ea0830716aa17b8cfbf757d714a8a81cc2/pdf