DEN GVT, political parties reached broad agreement on personal income tax reform.
Parties simultaneously increased the general employment deduction for everyone in work, and the additional employment deduction for single parents.
Agreement is estimated to increase the labor supply by 5,300 people in 2030.
Provisions
New employment deduction introduced for seniors in 2 years before state pension age.
Tax-free senior premium increased in first and second year after state pension age.
Pool set aside for bonus for vulnerable young people without education / employment.
Top tax is eased at the same time top-top tax introduced for highest earners.
Parties have also decided that the basic deduction in property tax will be increased.
The agreement is estimated to increase the labor supply by 5,300 people in 2030.
Implementation
Increase in general employment deduction and additional employment deduction for single parents will be phased in from 2025.
Reduction in the top tax and the introduction of a top-top tax, as well as the increase in the basic deduction in property tax will take effect from 2026.
Increase in the senior premium, new additional employment deduction for seniors and the pool for young people will also take effect from 2026.
