The richest 1% in the Netherlands pay relatively less tax than everyone else and their incomes have risen more sharply, according to new calculations by the government’s macro-economic forecasting agency CPB. Earlier research, based on figures from 2016, showed that people on the highest incomes pay less tax and the new figures, based on the period 2011 to 2019, paint a similar picture. The very richest, or 0.01% of the population, paid a tax rate of some 28%, well below the 40% paid by people with average incomes...
Super late to the party but every comment in response to yours is incorrect or not the full reason for capital gains being taxed less than income tax. The economic justification for a lower tax rate on capital gains relative to ordinary income is threefold: it is not indexed for inflation, it is a double tax, and it encourages present consumption over future consumption. The biggest being the last point, the gov’t wants people investing, borrowing and spending so the lower tax is an incentive to keep your money in the .arket and not in a savings account or under your mattress.
I shouldn’t have started by saying the other comments are wrong, but they all seemed to miss the actual reason you were asking about.
Super late to the party but every comment in response to yours is incorrect or not the full reason for capital gains being taxed less than income tax. The economic justification for a lower tax rate on capital gains relative to ordinary income is threefold: it is not indexed for inflation, it is a double tax, and it encourages present consumption over future consumption. The biggest being the last point, the gov’t wants people investing, borrowing and spending so the lower tax is an incentive to keep your money in the .arket and not in a savings account or under your mattress.
I shouldn’t have started by saying the other comments are wrong, but they all seemed to miss the actual reason you were asking about.