2023 Tax Plan - Outline of VAT and excise

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Outline of VAT and excise 

2023 Tax Plan - Budget Day (Prinsjesdag)

The following lists the measures proposed in the 2023 Tax Plan in respect of VAT and excise taxes

22 September 2022

Outline of VAT and excise

Back to outline 2022 Tax Plan

Dutch version

Temporarily reduced VAT rate on energy

For 2022, the government has taken additional purchasing power measures in respect of VAT, which should cushion the impact of high energy bills on consumers. In the period from 1 July 2022 through 31 December 2022, the reduced VAT rate of 9% will be applied to the supply of natural gas through the natural gas system, to the supply of district heating through a heat network, and to the supply of electricity through the electricity grid. In 2023, this support will be continued by other means, in the form of a lower energy tax.

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0% tariff solar panels

The government proposes to include a zero VAT rate in the VAT Act for the supply (including intra-Community acquisition and import) and installation of solar panels on or in the immediate vicinity of homes, with effect from 1 January 2023. The government wants to use the possibility offered by the VAT Directive to introduce this zero rate, in an effort to reduce the administrative burden for solar panel owners and the Tax Administration and to encourage investment in solar panels. The possibility and desirability of applying the zero VAT rate to the supply and installation of solar panels on public or other buildings used for public interest activities will also be examined.

General rate for laughing gas canisters

The government proposes to apply the general VAT rate of 21% to the supply of laughing gas canisters (so-called dinitrogen monoxide/N2O canisters). The government thus discourages the sale of the laughing gas canisters, mainly to young people, who use it as a recreational intoxicant. A specific exception is made for the supply of laughing gas that qualifies as a medicine. This will continue to be subject to the reduced VAT rate of 9%.

Increase in tobacco duty

Tobacco excise duty will be increased up to EUR 10 per pack of 20 cigarettes by 2024. The increase will be introduced in two steps and will also apply to smoking tobacco and cigars. The measure is part of the coalition agreement’s plans to have a smoke-free generation by 2040. The rationale is that higher prices reduce the demand for tobacco.

Extended reduction of excise duty on fuel

Excise duty rates on unleaded petrol, diesel and LPG have been reduced sharply from 1 April this year to cushion high fuel prices. This is a temporary measure that will expire at the end of this year. The government now proposes to maintain these reduced rates until 30 June 2023 as energy prices are still very high. The reduction is 17.3 cents for unleaded petrol, 11.1 cents for diesel and 4.1 cents per litre for LPG. From 1 July 2023, half of that reduction will be maintained. The increase in diesel excise duty provided for in the climate agreement will be postponed until 1 July 2023.

Increase in consumption tax on non-alcoholic beverages

In line with the coalition agreement, the government proposes to increase the consumption tax on non-alcoholic beverages. From 1 January 2023, the rate will be increased by EUR 11.37 to EUR 20.20 per hectolitre of non-alcoholic beverage and from 1 January 2024 by EUR 2.47 to EUR 22.67. From 2024, mineral water will be exempted from consumption tax. The measure aims to promote the consumption of mineral water, as a healthy alternative to soft drinks. At the same time, excise duty on light beers will be increased and aligned with the duty charged on non-alcoholic beverages. The measure should generate EUR 300 million annually.

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