The old flat 30% expatriate exemption was reformed to a tapered 30%/20%/10% schedule and further adjusted in the 2025 budget. The winners and losers, by profile.
The Netherlands' 30%-ruling — the fixed allowance that let qualifying incoming employees receive 30% of their gross salary tax-free for up to five years — was for two decades the single most identifiable tax benefit in the Dutch inbound-talent package. It was simple, generous relative to peers, and predictable. The 2024 Tax Plan changed all three attributes at once, and the 2025 budget adjusted the compromise a further step. The question for anyone planning a Dutch move in 2026 is what is actually left.
The pre-2024 regime permitted qualifying applicants — an incoming employee recruited from abroad, employed by a Dutch withholding agent, meeting a specific-expertise test implemented via a salary threshold — to exclude 30% of their gross salary from Dutch income tax for a maximum of five years. The benefit was universal across the five years at the same 30% rate. Applicants with specific master's degrees under the age of 30 qualified at a lower salary threshold (€35,048 in 2025 equivalents); all other applicants faced a €46,107 threshold. Employers applied the ruling on payroll; employees needed only to ensure the initial eligibility decision from the Belastingdienst was in place.
The 2024 reform, adopted in the Belastingplan 2024 and taking effect on January 1, 2024, changed the benefit from flat-rate to tapered. Qualifying new applicants received 30% of gross salary tax-free for the first 20 months, 20% for the next 20 months, and 10% for the final 20 months — a 30/20/10 schedule over the same five-year maximum. The stated rationale was fiscal consolidation plus an argument that the peak benefit was concentrated in the middle years of an expatriate's tenure when retention needs are highest, not at arrival when offers are negotiated.
The political pushback was substantial and came from an unexpected direction. Dutch employer associations — notably the VNO-NCW employers' federation — argued that the tapered schedule would damage the Netherlands' competitive position in graduate-level and early-career recruitment at exactly the moment when European competitors were moving in the opposite direction. Ireland's expat regime had narrowed but not tapered; Spain's Beckham remained flat; Portugal's IFICI was launching with a flat 20% on professional income. The reform made Dutch packages harder to describe in one sentence at exactly the moment the marketable simplicity had become valuable.
The 2025 budget, adopted in late 2024, revised the revision. The new rule for applicants from January 1, 2027 forward is a flat 27% tax-free allowance for five years — a partial walk-back from the taper, but a permanent step down from the historic 30%. Applicants whose rulings started between January 2024 and the end of 2026 remain on the 30/20/10 schedule. Applicants whose rulings started before January 2024 are grandfathered at the original 30% flat for the remainder of their five-year window.
The practical effect is three-tiered eligibility, which makes every Dutch move conversation until late 2027 a moderately complicated exercise. A move in 2026 falls under the 30/20/10 regime for its full duration. A move in 2027 or 2028 falls under the flat 27%. A move in 2023 or earlier retains the flat 30% until expiry.
The winners and losers under this settlement are profile-specific. An incoming employee with a five-year horizon, high salary, and predictable tenure does modestly worse under 30/20/10 and modestly worse under 27% flat than under the old 30%. The arithmetic for a single filer on €120,000 gross is roughly as follows: the old 30% regime saved approximately €15,500 per year in Dutch tax in the current brackets; the 30/20/10 schedule averages closer to €10,300 per year over five years; the flat 27% equals roughly €13,900 per year. For high earners, the transition from 30% to 27% is a headline the Dutch market can absorb; the transition from 30% to the tapered 30/20/10 is uncomfortable enough to influence employer offers.
A more consequential change, less discussed than the headline rate, is the 2024 removal of the option to treat yourself as a partial foreign taxpayer — the "partiële buitenlandse belastingplicht" — during the 30%-ruling period. Before 2024, an employee with the 30%-ruling could elect partial non-resident status for Box 2 (substantial-interest income) and Box 3 (savings and investments) tax purposes, exempting foreign-situs savings and investment income from Dutch tax. The 2024 Belastingplan ended this election for new applicants, with transitional provisions running to the end of 2026 for existing ruling-holders. For an incoming employee with substantial foreign investment assets, the loss of partial non-resident status is often a larger tax cost than the headline reduction in the salary allowance.
The labour-market evidence on whether the reforms have moved the Netherlands' competitiveness is mixed. IND's total Highly Skilled Migrant permit issuances in 2024 were roughly 41,000, broadly flat against 2023, suggesting no collapse in demand. CBS wage and employment data for the foreign-born highly-skilled cohort through 2025 suggests a modest uptick in turnover among ruling-holders reaching the threshold where the 30/20/10 steps down — a pattern the employer-federation warnings had predicted but that is harder to distinguish from ordinary job-change dynamics.
For an applicant considering the Netherlands in 2026, the realistic posture is that the 30%-ruling remains a meaningful benefit — the old 30% flat was never common globally, and even the 27% flat is competitive against most of Western Europe — but the negotiation is no longer automatic. Employers that previously assumed the ruling would do the heavy lifting now need to price its reduction into the gross offer. Employees need to know which tier they fall under and what expires when. The Dutch expatriate package has not collapsed. It has simply stopped being simple.
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