Many changes in Dutch coalition agreement for entrepreneurs

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The new coalition agreement between VVD, CDA, D66 and CU seems to be favorable for entrepreneurs. The agreement starts with the phrase that ‘entrepreneurs are of inestimable value for the country’ and that they are the ‘engine of our economy’. The agreement also stresses that jobs and prosperity in our country are the result of innovative start-ups, family businesses, global companies and a large variety of SME’s (small and medium-sized enterprises). The coalition aspires social, economic and digital leadership in Europe and some of these aspirations are followed by concrete measures. These are the main changes for entrepreneurs:

In the future, it’s easier for small enterprises (with a maximum of 25 employees) to offer someone a job because of shorter wage payment for sick employees. Instead of two years, employers are now required to pay one year of salary to employees with prolonged illness. However, all SME’s are obliged to pay for a premium that cover costs of this second year of wage payment for sick employees. Employees with prolonged illness also remain protected from dismissal in this second year of sickness. Before agreement, employers had to pay out 170% of salary in two years. The corporation tax will also be reduced: for profits below €200.000, rates will drop from 20% to 16% in 2021. For profits over €200.000, rates will drop in different phases from 25% to 21% in 2021. Taxes for dividend (profit distribution to shareholders) are abolished in its entirety. The coalition also believes that it’s too difficult for employers to fire an employee. In the new agreement, judges will get more freedom to combine separate grounds for dismissal into a new ground for resignation. Issues with an employee, such as culpable behavior, dysfunction and a disturbed work relationship, can be combined into a valid ground for dismissal. Small enterprises who cannot pay the transition allowance for a fired employee can apply for a transitional arrangement. Upon approval, employers are allowed to only pay a part of this compensation. A total of 100 million euros is assigned for these new changes in the field of entrepreneurship.

The cabinet tells us to ‘trust in the future of our country’ – the motto of the new coalition agreement. The formation of Rutte III has been the longest ever in history: a total of 209 days were needed to reach an agreement. After the presentation of the new coalition agreement, the House of Representatives (Tweede Kamer) will discuss the new ideas. Want to read more about the agreement and changes in the entrepreneurial field? Download the agreement right here (in Dutch).

Sources: NU.nl, Sprout.nl

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