Dutch govt. expects €8 billion more tax, premium income this year
The Dutch government expects to make nearly 8 billion euros more on taxes and premiums than estimated on Budget Day last year, according to the Spring Memo sent to parliament by Finance Minister Jeroen Dijsselbloem on Thursday. The extra money mainly comes from VAT (€2.4 billion), corporate tax (€2.3 billion) and wage and income tax (€1.2 billion), NU.nl reports.
The Spring Memo shows the changes the government made since the budget was presented on Budget Day in September last year.
The financial windfall can largely be attributed to the improving economy, which is growing more than expected this year. For example, current expectations are that unemployment will drop to 4.9 percent of the working population this year, compared to the Budget expectation of 6.2 percent. That in turn reduces the cost of unemployment and welfare benefits by 234 million euros. And at the same time, more income tax is collected because more people are working.
The healthcare sector is also spending 164 million euros less on healthcare equipment than expected in the National Budget in September.
The budget surplus will amount to 0.2 percent of the GDP this year and continue to grow to 1.3 percent in 2021, according to the Spring Memo. Government debt will come out just below the 60 percent of GDP limit set by the European Union. In March central planning office CPB estimated that the budget surplus will reach 0.5 percent of GDP this year. According to the Ministry of Finance, the 0.3 percent difference is the result of policy - CPB works with raw figures, which can be changed by political choices.
The Spring Memo also mentions a number of setbacks. A while ago Dijsselbloem mentioned a budget deficit at the Ministry of Education of "several hundred million euros". The Spring Memo reveals that the Ministry is facing a 200 million euros deficit. This can partly be attributed to estimates on student and pupil numbers being too low in the National Budget. Long-term care is also 176 million euros more expensive this year than expected.
To give the next government more insight into the finances, the Ministry of Finance also added an oversight of the revenue and expenses for the coming years. For this year the government made 100 million euros available for nursing home care, on top of the once-off 100 million euros previously announced. And 145 million euros per year until 2021 to train or retrain more people in the sector. Higher income for the government from pension premiums means that officials can expect a wage increase this year, 342 million euros set aside.
50 million euros will be spent on security, stability, migration cooperation and asylum shelter in the region. The budget for development cooperation is increasing with 62 million euros this year. And the Koninklijke Marechaussee is structurally getting 20 million euros extra for training more officers and for extra surveillance on Dutch borders, airports and seaports.