What the Rutte IV coalition plans will mean for your wallet

The new Rutte IV Cabinet plans to implement some 3 billion euros in tax cuts, explicitly aimed at households with low and mid-level incomes. Here follows a summary of the VVD, D66, CDA, and ChristenUnie's plans that will affect the average citizen's wallet.

First up, childcare will soon be very affordable. The Cabinet plans to cover up to 95 percent of childcare costs, with families being responsible for the remaining 5 percent. The childcare allowance, problems with which left thousands of families in financial troubles and resulted in the Rutte III Cabinet's resignation almost a year ago, will be scrapped. The coalition parties eventually want to abolish all allowances, but those plans aren't fully formed yet.

The minimum wage will gradually be increased by 7.5 percent to 11 euros. The link between minimum wage and social assistance benefits and the state pension will also remain, so these will also increase.

The Cabinet plans to implement road pricing, or kilometer tax, by 2030. This basically means that road tax will be changed so that motorists pay for the kilometers they drive. Roads will be toll-free again. Exactly how this will work is not yet clear. All that is known is that the road pricing will not be linked to where and when you drive.

The student loan system will be scrapped. All students will again receive a basic study grant. There will also be an income-dependent supplementary grant for students who can't count on financial support from their parents. The amounts of these grants are not yet known. Students who ended up on the loan system in the past years will be compensated, either in the form of a discount on their study debts or a study voucher for future studies.

Former students who want to buy a home will also have a somewhat easier time getting a mortgage. Mortgage lenders will no longer take the original study debt into account but only what is left of it.

Bad news for first-time homebuyers with wealthy parents. The coalition is scrapping the once-off tax-free gift of up to 100,000 euros to help finance the first home.

The Rutte IV coalition also has other plans to make housing more affordable, especially for first-time buyers and people with lower incomes. For example, the new Cabinet wants to lower social housing rents. On the other hand, people with a high salary who continue to live in social housing can expect a step-by-step increase in rent. The parties also want housing corporations to give tenants more chances to buy their rentals under still unknown conditions.

The new Cabinet also intends to tackle the savings tax, which taxes the returns on savings. Now that the savings interest is negative for large amounts, people with considerable wealth are paying tax on returns that don't exist. The Cabinet wants to implement a system in which the wealth tax is levied on the actual return by 2025.

The new government wants to encourage a healthy lifestyle, which means higher taxes on sugar and tobacco. Excise duties on cigarettes will be increased to 10 euros per package. The tax on soft drinks will increase, and the Cabinet wants to introduce a sugar tax. VAT on fruit and vegetables will eventually be lowered to 0 percent.

Good news for women. The new Cabinet wants to make contraceptives easily accessible and free of charge. Currently, the basic health insurance package reimburses the pill for girls under 18 and partially reimburses the pill for young women aged 18 to 21. After that, women have to pay for their own contraceptives.

And the healthcare deductible will remain 385 euros. However, the Cabinet plans to make that payable over multiple treatments instead of paying the entire amount after one expensive treatment.

The Tweede Kamer, the lower house of Dutch parliament, will debate the coalition agreement on Thursday.