Supreme Court upholds 150 kilometre minimum
The Advocate General to the Netherlands Supreme Court recently affirmed that the 150 kilometre minimum is to be upheld as part of the 30% ruling owing to there being no question of obvious overcompensation where the relevant tax regime is concerned. Had this been different, this could have prompted the 150 kilometre maximum being rendered unlawful.
The Advocate General in Supreme Court proceedings on the theme of the 30% tax ruling presented a supplementary opinion. The Supreme Court had initially come to the decision that the European Court of Justice should issue a preliminary ruling on the criterion –introduced on the first of January 2012 – whereby expats for a period of 24 months prior to taking up their job in the Netherlands should have had their customary abode at least 150 kilometres away from the Dutch border in order for them to qualify for the 30% regime. The European Court of Justice ruled that the 150 kilometre minimum was not in breach of the free movement of employees unless the regime provided for obvious overcompensation of actually incurred extraterritorial costs, as something which was to be looked into by the national court. The Advocate General in his supplementary opinion has now addressed this analysis, stating as his view that the burning question was how the legislator had originally intended the regime to operate, rather than there being a need to embark upon an empirical investigation rife with challenges of a practical nature. Although he conceded that the regime did allow for some overcompensation, particularly for those in the higher income brackets, he affirmed that there was no question of systematic and obvious overcompensation vis-à-vis the Dutch-based expat worker community as such, and concluded that the appeal in cassation should be denied.