A complaint made against tax law is what we read in the news. We have even been contacted to assist in such a complaint. If we can provide content. We cannot.
Complaint made against tax law
A complaint made against tax law could be seen as a complaint made against the maximum speed a car can drive on the road. It is useless.
Louis the 14th thought of himself as King and God and he drained the French people for his own pleasure. In 1789 the French revolution took place where the French Kingdom ended under the Guillotine. In 1791 the new law was introduced based on the thoughts of Montesquieu.
Charles Montesquieu concluded that in a civil stated the power of created rules, executing rules and judging rules should be disconnected from each other. Trias poitica.
The Dutch Government is in charge of creating the law, like the Box 3 wealth tax. Making a complaint in court against Box 3 law conflicts with the Trias Politica. A court cannot judge the law. Hence I think making a complaint against the Dutch tax system in court is useless.
Court case – house doctor pays too much tax
A regular house doctor has to pay EUR 51.485 Box 3 taxation in his 2016 income tax return. As he very much disagreed with the amount of tax, he simply did not file the 2016 income tax return. The banks already provided the tax office with the bank balance, as they do. So the Dutch tax office imposed a EUR 51.485 tax assessment based on EUR 4.314.884 savings account. Including EUR 369 penalty for filing the tax return too late.
The doctor made a complaint to the tax office based on ‘when is enough, enough?’. And he claimed that the taxation eroded his savings account. An unreasonable amount of tax was claimed.
The tax office denied the complaint. The doctor went to court and also the court did not agree with the amount of tax over his savings being extreme.
Government budget
Above we addressed the legal system that applies in the Netherlands, on basis of which you cannot ask a court about the law being valid. The other reason is the budget.
The Dutch Government basically has a household book with expenditures. Based on those the tax rules are being created. For instance the Value Added Tax rate went up from 17,5% to 21%. The European Union desires one uniform rate of 27% Value Added Tax.
The income tax rates are there so support the household costs of the Netherlands. The elections over the years show that the voters find that income from labour should be taxed less. You work hard and with 52% tax (was in very old days 72% tax) it felt like most is taxed. Hence the taxation on labour is reduce to below 50%.
When less tax is levied on work, more tax is levied on other aspects, to balance the books. The choice was Box 3 wealth tax. In a socialistic country as the Netherlands that is the more logic choice. Those who have more, can help the ones that have less. The court case above shows exactly this situation. The house doctor has EUR 4,3 mln in the bank and complaints about taxation. This tax can help others who are less fortunate.
Steady base
Another reason why I think you cannot appeal the Dutch Box 3 wealth tax rules is the steady base the Netherlands provides. The house doctor in the example, could he maintain the EUR 4,3 mln savings account in a third world country bank? Maybe yes, maybe no. Could be less secure. And the security the Netherlands provides, could that have resulted in the first place the house doctor was able to get to the EUR 4,3 mln?
When the world wide tax systems are compared to the state the countries are in, the infrastructure, the business environment, we think that is related.
Tax is exciting
We think tax is exciting. Some are less excited about paying tax. Some are excited about paying tax, as they state: I must have made some money. We are eager to assist you with filing your income tax return. Based on the above article it does not imply we will not claim all credits. Then again, if you are to pay tax in the end, that is part of the game.
