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Jan van de Streek: ’Consumer spending contingency plan is tremendously complicated'

The coalition parties of the Dutch Government plan to convene on Wednesday and Thursday this week for a priority meeting on the predicted 6.8% decline in consumer spending. The Government is looking to compensate this unprecedented drop, but how can they do this effectively and affordably?

‘All the budget buttons that a cabinet can usually "tweak" are mostly on the periphery, really,’ says Jan van de Streek, Professor of Tax Law at Leiden University in Dutch newspaper the Leeuwarder Courant. ‘This is a much larger redistribution operation and much more political as a result.’

Van der Streek says that it is becoming increasingly difficult to implement income policy through tax measures. ‘Research by the CPB Netherlands Bureau for Economic Policy Analysis has already shown that in the Netherlands we have all but stopped using tax measures for redistribution. These days, we mainly use social benefits. Effectively, what we have now is a flat tax rate: one tariff for 68,000 euros and under and one tariff for over. That makes it difficult to reach specific income groups. One suggestion is to introduce a few new tax brackets, but that's seen as blasphemy.'


You can read the full article (in Dutch) here.

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