Netherlands: Draft bill on temporary windfall profits tax on electricity producers
Would introduce a temporary 90% tax on the windfall profits of inframarginal electricity producers
Would introduce a temporary 90% tax on windfall profits
The Ministry of Economic Affairs and Climate Policy and the Ministry of Finance published a draft bill on 27 January 2023, that would introduce a temporary 90% tax on the windfall profits of inframarginal electricity producers.
The tax would apply with respect to electricity generated in the Netherlands or in the Dutch territorial waters of the North Sea that has been fed into the electricity grid, or into a direct line of which the power plant has an installed capacity of 1 megawatt (MW) or more. Only electricity generated with the inframarginal energy sources wind energy, solar energy, hydropower, biomass fuels, biogas, waste and nuclear energy, as well as electricity generated from coal, would be subject to the tax.
The tax is proposed to apply retroactively to 1 December 2022, and the entire tax period will cover the months 1 December 2022 through 30 June 2023. The European Commission (EC) will evaluate it no later than 30 April 2023, after which the tax may be extended or amended.
The draft bill will be open for internet consultation until 16 February 2023.
Read a February 2023 report prepared by the KPMG member firm in the Netherlands
The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 3712, 1801 K Street NW, Washington, DC 20006.