Royal tax controversy: Dutch state annually pays back ruling family's taxes

King Willem-Alexander and his predecessors were and still are compensated for the taxes they must pay on their private assets, according to research by RTL Nieuws. This started in the 70's, when it was first decided that the the ruling Royals will pay taxes on their personal assets.

RTL Nieuws makes this conclusion based on partly state secret documents from the period 1969 to 1973. In 1973 the Financial Regulations for the Royal Family Act was implemented. It states that the Dutch State will pay the costs associated with the Dutch monarchy. But the monarchy must pay the taxes on personal assets - such as savings and shares - itself.

The documents in the broadcaster's possession suggest that then Queen Juliana received an additional amount of 150 thousand to 200 thousand guilders per year after the law was implemented.

From next year King Willem-Alexander will receive 5.5 million euros a year. The calculation of the money the King receives still derives directly from agreements made in 1973, according to the broadcaster. This includes arrangement that tax payments will be compensated.

According to RTL, Prince Bernhard exerted pressure for compensation for the partial abolition of tax exemptions for the Royal Family. The Secretary General for the Ministry of Finance at the time made a note to the involved ministers stating that he disagrees with the deal. According to him, it is "absolutely unjust that tax exemptions are abolished on the one hand, while on the other that is "reversed in a camouflaged manner".

Both former Prime Minister Jane Peter Balkende and successor Mark Rutte defended the amount the Royal Family receives. Balkende stated that since 1973 "no relevant circumstances changed", so there is no reason to adjust the payments to the King or Queen. Rutte also referred to agreements made in the past whenever the topic came up, according to RTL.

Dutch parliamentarians are stunned by this revelation. The PvdA plans to raise the issue during Question Hour in parliament on Tuesday afternoon. "This is a very strange situation. We want clarity from the Prime Minister about this agreement. What is going on? If it is true we want it to stop immediately", MP Jeroen Recourt said to broadcaster NOS. "Everyone pays taxes, the king too."

"We've felt for some time that the King should pay taxes. There is a motion to regulate that, but the prime minister does not implement it. Now it seems to be even worse and he even gets compensation for the part of taxes he does have to pay." Recourt continued. "Those crazy arrangements that were maybe normal in 1849, are outdated. The King and Queen are doing very well, we need them, they provide connection. But paying modern taxes belongs in a modern monarchy."

SP parliamentarian Ronald van Raak wants to know from Rutte how much money exactly is involved in this arrangement. "If people have to pay taxes on their assets, they are not compensated for it by the government. Why does it happen for members of the Royal Family?" he said to RTL. "They received this money unjustly, I want to know exactly how much it is."

D66 leader Alexander Pechtold was surprised by the revelation - the current parliament knows nothing of this arrangement. "I am particularly disappointed that for the umpteenth year there is again something that makes me think: why is this not better regulated", he said to RTL. "We all pay taxes. The Royal Family doesn't for many things. We thought for years that they did for a small part of their assets and that turned out not to be true. That is not something I can explain to people who do pay their taxes."