On Budget Day (Prinsjesdag), 17 September 2019, the Dutch Government introduced its 2020 Tax Plan to the House of Representatives. While some measures are final, some are still subject to acceptance by the upper and lower houses of parliament. There are many changes this year. However, for entrepreneurs and business owners, two announcements stand out. The first is about the value-added tax (VAT) of electronic books, and the second relates to the private business ownership allowance.
- If you sell electronic books or other electronic publications, then the VAT rate on those is now 9%. It was reduced from the standard 21% that used to be applied to these products. This is in correspondence with the EU member states’ 2018 decision to remove the discrepancy between printed and electronic publications. Previously, printed books and newspapers had a reduced VAT, while their identical electronic counterparts had a standard VAT. This might have directed some consumers toward print, especially for those buying in large quantities.
- If you are an entrepreneur, then you might already qualify for the private business ownership allowance. Starting in 2020, there will be a gradual reduction of this amount to reach €5000 in 2028. Up until now, the allowance was €7280. Check out our graph below to see how the allowance will change through the years:
The steady decrease of the private business ownership allowance until 2028.
While these might be the most relevant to our readers, there are plenty of updates that may interest you. Take a look at the Official Announcements Page for Prinsjesdag to learn more. More so, you might be interested in our 2018 Prinsjesdag announcement, where we analyzed the reason for the increase of the reduced VAT rate.