The story I am about to tell you probably sounds familiar. After all, this is the story that so many people in the Netherlands are currently sharing – the story of how the proposed changes to the term limit of the 30% tax rule for current recipients will have detrimental consequences for recipients of the policy and for the corporate climate of the Netherlands.
In fact, there is an entire group dedicated to raising awareness of this issue known as the United Expats of the Netherlands – of which I am a member – and numerous articles abound about the severe and real-world consequences of this proposal.
But, what I am missing from many of these conversations is how this proposal will affect partners and children too. The impact on expat families is severe, and I think it is about time that we talk about these consequences.
Almost five years ago, my husband and I came to the Netherlands because of my husband’s job. A recruitment agency contacted him and, while discussing the position, the recruiter told him about the 30% ruling and how the ruling can help offset the additional costs we would experience as expats. At that time, he was considering different job offers in other countries, but the 30% ruling tipped the scale in the Netherlands favour. Once my husband accepted the position in Amsterdam, we applied for the 30% ruling and received written notice of approval (with an end date of January 2022). From that moment on, we arranged our lives – including future plans such as starting a family and financial planning – with this date in mind.
When you move to another country, many economic and sentimental sacrifices are made. Just like many other expats, we had to give up the lives we had in our country, say goodbye to our family and close friends, and face several expenses (roughly 5000€) as part of our transition. Although relocating is a challenging situation for most people, I think it was a bit easier for my husband than for myself. When we arrived, he had a good job opportunity in an international company. I had nothing. I struggled with a new country, a new language, a new job market. My only hope was that all of these inconveniences would someday pay off.
For me, the biggest concession I had to make when we moved to the Netherlands was quitting my job. For several months, we had to live on only one income. Even more, I had to accept an entrance position that did not match my education and experience. Indeed, for me, moving to the Netherlands meant a step back in my career. Although I had to start from the scratch, I was lucky – compared to many – because I was allowed to work from the first day. Many partners come here without a work visa, and for several years they have to back-burner their careers and rely on just one salary.
After some time, our efforts started to be rewarded. We loved living here and we overcame the challenges of starting a new life so much that we decided to grow our family. Our baby was born in the Netherlands, and with this change, I learned we had to make new sacrifices. If my parents and in-laws had lived close, we could have skipped at least two days of daycare (around 700€), and not worry about missing work when our child was sick. Moreover, my salary was nothing to write home about and taking into account daycare fees, we came to the conclusion it was time to, again, put my career aside and for me to stay home to raise our child. Balancing family and work life is always a difficult puzzle, and being an expat adds a new level of difficulty to an already complicated situation.
Importantly, because of our transition to the NL, we had to assume certain expenses that we did not have to worry about in our home country ( i.e. health insurance and medical costs, a private retirement plan for me, legal advice and translations). But we knew this coming into this country and we factored these costs into our budget – a budget that included the 30% tax ruling. This tax rule has balanced our income and expense and, as it is intended, has compensated us for “for expenses that foreign employees experience when working outside their home country”.
Now, according to our calculations, our net income will be suddenly reduced by nearly 1000€ per month if this new proposal is approved. The consequence for us will be clear: we will not be able to afford to live in this country anymore. Having to leave the Netherlands so abruptly will be heart-breaking for us. We want to stick with the plan we made years ago, and let our son know his birthplace. And now … we are living in limbo as we wait to find out whether the Dutch government will break the deal it made with us when we arrived. Is anyone in the government taking a moment to think about us? To think about how difficult it will be to explain to our son that we had left his birthplace abruptly because some politicians were unable to keep their word to us? Or how difficult it will be to tell him we don’t trust the government in his birth country?
Would we have made a different decision if we knew that the 30% ruling would end in January 2019? YES. Did we have any reason to believe the Dutch government would make a change to this policy withOUT transitional regulation to protect current recipients? NO. Was all of our sacrifices meaningless? I hope not, but the Government has the last word. Until 18 September, we sit in limbo – waiting to know our future. Until then, the only thing I can do is share my reality and, hopefully, appeal to common sense.
Are you affected by the 30% ruling? Let us know your story.