Cabinet presents €967 million energy relief package, as oil crisis plan enters phase 1
On Monday, the Dutch Cabinet presented a combined set of economic measures and crisis planning in response to the economic impact of the conflict in the Middle East, including a package worth nearly 1 billion euros, with 627 million euros in spending measures and 340 million in tax-related steps for 2026, alongside the move into phase 1 of the national oil crisis plan. The Cabinet, which does not hold a majority in either Parliamentary house, will next have to find support from opposition parties on the left and right.
The government stated that it is responding to higher energy prices affecting households and businesses, presenting coordinated actions across purchasing power support, business resilience, and energy security.
In one set of measures totaling about 967 million euros, the Cabinet said it is increasing the untaxed travel allowance, eliminating road tax for trucks, and reducing vehicle tax for small commercial vans by 50 percent for at least six months. The proposals were presented by the Finance, Climate and Green Growth, and Economic Affairs ministries.
The untaxed travel allowance rises by 0.02 to 0.25 cents per kilometer, retroactively applied for 2026. The government estimates this translates to roughly 30 cents in benefit per liter of fuel for commuters.
Despite political pressure, the Cabinet is not lowering fuel excise duties, arguing such measures are too costly and insufficiently targeted. Officials said reducing petrol prices by 10 cents per liter would cost the state around 1 billion euros.
The government also confirmed that trucks will pay no road tax starting July 1 for the remainder of the year, while other commercial vehicles will see a temporary 50 percent reduction in road tax for at least half a year.
Additional measures include talks with public transport companies about subsidies, including incentives for off-peak travel.
Households with low to middle incomes will receive support to switch to used electric vehicles, requiring the trade-in and scrapping of older fossil-fuel cars with low emissions standards. The scheme is valued at 50 million euros.
The Cabinet is also allocating 195 million euros to the national energy emergency fund, aimed at supporting more households with rising energy bills than in previous years. An earlier version of the fund was introduced at the start of the Ukraine war but was later discontinued.
To improve housing energy efficiency, 180 million euros are being directed to the National Heat Fund, allowing homeowners to finance insulation improvements. Additional funding includes 80 million euros for “energy fixers,” 25 million euros for homeowners’ associations (VVEs) to improve sustainability, and 15 million euros for residents in poorly insulated housing through a national livability program.
The agricultural sector receives 25 million euros to reduce energy and fertilizer use, while fisheries receive 25 million euros to lower dependence on fossil fuels.
To encourage green investment, the energy investment tax deduction will increase from 40 to 45.5 percent in 2027. In addition, alcohol excise duties will rise in line with inflation starting in 2027. To finance the package, the government will phase out the starter tax deduction for new entrepreneurs in 2027. It will also reduce the small-scale investment tax deduction by lowering its ceiling. In addition, it will index alcohol excise duties upward starting in 2027.
Separately, the government has escalated the national oil crisis plan to phase 1. The Ministry of Economic Affairs said this reflects disruptions in normal crude oil supply. Officials said there are currently no acute fuel shortages, and existing reserves could cover demand for months to more than a year under current conditions, though kerosene and diesel supply disruptions are increasing.
The Cabinet said it is intentionally acting cautiously to preserve room for further interventions if the situation deteriorates.
A parliamentary debate is scheduled for Wednesday, with a majority in the House of Representatives expected to support the proposals, NOS said.
