'Millionaire tax' dispute leaves Dutch government on brink of collapse

The Dutch government faces collapse following a disputed proposal for a millionaires' tax, placing a three-party coalition at risk after less than nine months in power. Parties disagreed over a 2027 tax plan deal with the left-wing opposition, exchanging wealth taxes for support. The lower house narrowly passed the left-leaning bill late Thursday, after the center-left D66 party and Christian Democrats allied with left-wing opposition groups.

The conservative People's Party (VVD) threatened to quit if the measure passed. Prime Minister Rob Jetten, the youngest Dutch prime minister at 38, will attempt to save his minority government in a Friday meeting. VVD leader Ruben Brekelmans said the vote outcome was disillusioning and prompted his party to reassess its position.

The bill proposes taxing assets above €60,000 annually at 38.5 per cent, a rate among the highest in the euro region. The Dutch government has also eliminated plans for a capital gains levy on investments. The disagreement highlights the power dynamics in the fragmented Dutch parliament, where coalition governments often require support from multiple parties to pass legislation.