The former Secretary of State’s proposal to reform the capital gains tax (box 3), which should take effect per 2022, has been withdrawn. This is announced by the current Secretary of State.
The reason given is that the plan contains a big difference between the Box 3 levy on returns from investments and returns from saving which is, among other things, not be legally tenable.
Under the current tax system, it is assumed that a fictitious return of around 4% is achieved on all the assets in Box 3. This is subject to tax which means that savings that yield a low return are relatively heavily taxed.
The Secretary of State indicates that the only real solution would be to tax only the actual return. However, he indicates that the Tax Authorities cannot verify exact returns from investments. He indicates that he is looking for an alternative that “greatly spares small savers and investors”.
