Dutch officials propose reducing the tax exemption for gifts given to children by parents.
Dutch officials have proposed reducing the tax-free gift allowance for parents giving money to their children. Currently, parents can give up to €6,908 tax-free, while gifts from other sources are exempt only up to €2,769. The Ministry of Finance argues the higher allowance for children is outdated.
The ministry notes that the rule, introduced over a century ago to avoid taxing contributions for children’s upkeep, is now largely irrelevant. Today, fewer people have children, and many gifts are simply financial bonuses rather than essential support. Officials suggest making exemptions less dependent on the recipient’s relationship to the giver.
The proposal has drawn strong political opposition. Parties across the political spectrum, including VVD, CDA, PVV, and other right-leaning factions, criticized the plan, arguing that parents who work to provide for their children should not face higher taxes. Collectively, these parties control a majority in both the Tweede Kamer and the Eerste Kamer.
Ministry estimates indicate that reducing the allowance could generate around €60 million, a modest sum in the broader tax system. Most gifts fall near or just below the exemption threshold, while a smaller share is used to transfer assets tax-efficiently to reduce future inheritance taxes.
Given the strong opposition and the precarious nature of the minority coalition government, any move to implement the proposal would require convincing left-leaning and centrist parties, as well as persuading dissenting members within the coalition itself, to secure a parliamentary majority.