By way of a Second Memorandum of Amendment the tax measures proposed in the Rutte Cabinet’s coalition agreement ‘Freedom and responsibility’ that are to take effect from January 1, 2011, have been included in the 2011 Tax Plan and the 2011 Other Tax Measures Bill.
· The reduced VAT rate of 6% for the performing arts will no longer apply and is replaced by the general 19% VAT rate. This change also applies to art objects, collector’s items and antiques. The performing arts is defined for the purposes of VAT as admission to music and stage productions, such as operas, operettas, dance, musicals, lectures, and performances by performing artists. A transitional rule will allow the reduced rate to continue to apply to tickets sold in 2010 for performances that are to take place in 2011.
· Socially motivatedSocial investments, such as green and social-ethical investments, and investments in venture capital (either direct or indirect investments in venture capital and cultural investments) both receive a maximum exemption of EUR 55,145 in box 3. Tax credits linked to socially motivated investments and direct investments in venture capital and cultural investments and amounting to 1.3% of the box 3 exemption will no longer apply. The personal deduction for losses made on loans qualifying as direct investments in venture capital, i.e. the “Tante Agaath loans”, is also abolished. However, the personal deduction can still be claimed for losses made on loans taken out before January 1, 2011.
· As of January 1, 2011, the insurance premium tax rate levied on specific types of insurance will be increased by 2 percentage points to 9.5%. The increase applies to premiums with an expiry date after December 31, 2010.
· The implementation of a box 3 exemption and a tax credit for small and medium-sized enterprises (“SME”) investments, such as shares in an SME or an SME fund, will not go ahead.