The Netherlands

Globally, tax systems are continuously reviewed with a view to improving their fairness, equity and efficiency. Taxation has a central role in society and should, therefore, be the subject of ongoing discussion. Tax research should not be limited to one single tax jurisdiction, but have a wider scope, not so as to copy tax systems from other jurisdictions, but to learn from them —recognising the good elements in one’s own system and avoiding mistakes made elsewhere. This chapter will critically describe, analyse and evaluate the basic structure of Dutch capital gains taxes. The Netherlands does not levy a single capital gains tax. Capital gains have been included partly in the Personal Income Tax Act 2001 (PITA), as a rule in the Corporate Income Tax Act 1969 (CITA), and to a certain extent in the Inheritance and Gift Tax Act 1956 (IGTA). Capital gains are covered by the CITA insofar as it concerns capital gains attributable to companies and the IGTA to the extent capital gains arise from the event of inheritance or a gift. This chapter focuses on the PITA.
The author believes that as a matter of principle taxation of capital gains should be part of a comprehensive tax system that taxes a comprehensive concept of real net income. A general benchmark is presented in order to assess what the key issues in the design of capital gains tax regimes should be. This benchmark will be applied to the Dutch tax system. Attention will be paid not only to general and domestic but also to some international aspects of capital gains taxes with a view to what lessons can be learned from the Netherlands’ experience.