Q&As on adjustments to the tax system of the Caribbean Netherlands - Speech from the Throne 2023 (Prinsjesdag)
Report | 21-09-2023
The principal aim is to simplify and update the system.
The government will do so primarily through non-fiscal measures.
However, the tax-free allowance will be further increased as well.
The amount of this increase will be announced shortly.
In 2023, the tax-free allowance already went up from $12,198 to $17,352.
From 2024, the customary wage for company owners will be linked to the tax-free allowance.
In addition, clearer rules will be introduced in respect of permitted deviations from the calculation of the customary wage.
Private and commercial vehicles fall into different tax categories.
Different definitions apply at present, which causes confusion and lack of clarity.
The government has opted for one uniform term.
From 2024, the import of pick-ups and vans will be taxed at the high rate of general expenditure tax.
This measure will help create a level playing field, because entrepreneurs who also use their company vehicle for private purposes will have to pay the same rate as that applicable to private vehicles.
In this way, the Caribbean system will be in line with the Dutch model and the European directive applicable from 2024 on minimum taxation of internationally operating enterprises.
The measure will apply only in very specific cases and will also prevent abuse and tax evasion.
This measure is intended to discourage abuse.
At present, holding companies can perform investment activities without any impediment.
These companies will now have to meet stricter conditions in order to be eligible for a tax ruling, which means among other things that restrictions will be placed on the investment activities of these holding companies.
Holding companies already in possession of a ‘95% order’ will also have to meet these stricter conditions.
This requirement applies to new owners or possessors of homes or business premises.
They must report the purchase themselves, and may incur a fine if they fail to do so.
From 2024, the government wants to raise the annual turnover limit for general expenditure tax in respect of small enterprises.
The turnover limit will be $30,000.
This means that small enterprises will not be required to pay general expenditure tax.