The Dutch House of Representatives has moved forward with legislation targeting unrealized investment gains. On February 12, 2026, lawmakers approved a 36% tax on unrealized gains from assets such as stocks, bonds, and cryptocurrencies. This landmark legislation, known as the Actual Return in Box 3 Act, is a significant shift in capital taxation.
Dutch Parliament’s Approval of Unrealized Gains Tax
The bill is set to advance to the Senate. With the supporting parties maintaining a majority there, the legislation’s prospects are favorable. The Dutch government aims to enforce this tax by January 1, 2028.
Details of the 36% Tax on Unrealized Investment Gains
- The 36% tax applies to annual investment returns exceeding €1,800.
- Taxation will occur regardless of asset sales, diverging from traditional capital gains taxes.
- This measure replaces previous taxation schemes deemed unconstitutional by the Dutch Supreme Court in 2021 and 2024.
Financial analysts estimate a potential €2.3 billion annual revenue loss until this tax is fully operational. Despite substantial backlash, there was a parliamentary majority in support when legislators questioned State Secretary for Finance Eugène Heijnen extensively during a debate on January 19.
Implementation and Reporting Requirements
- Investors must report changes in asset values, as well as income from dividends and interest.
- Unrealized losses can offset future gains but are not applicable to prior tax years.
Real estate investments and startup shares will undergo different tax treatments. The government intends to levy taxes on rental income, while capital gains on property sales will be assessed separately. Notably, startups less than five years old with revenues under €30 million will not be subject to this tax, and primary residences maintain exemptions under existing income tax rules.
Criticism and Potential Consequences
Critics argue that this policy could spur capital flight and penalize investors by taxing unrealized gains. Many believe this approach may hinder investment activity, as it imposes expenses on profits that may never come to fruition. Concerns continue to mount over the impact on the middle class and the broader economy as this legislation moves closer to enactment.
The final vote in the House of Representatives is necessary by March 15, 2026. This timeline ensures financial institutions and the Dutch Tax Administration can upgrade their systems for a smooth transition to the new tax framework.
