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Expat scheme: answers from the State Secretary to questions raised in the Senate
On 29 October 2025 the State Secretary for Finance responded to questions raised in the Senate concerning the report "Kunde, Kosten en Keuzes" (Skills, costs and choices) by the SEO Economisch Onderzoek research bureau further to the evaluation of the extra-territorial costs scheme (ETK scheme), the expat scheme (30% facility) and the partial foreign tax liability, and further responses to this report by the State Secretary.
Efficient and effective
The State Secretary reiterated that the SEO report shows that the expat scheme is an effective tool for attracting international staff. SEO concluded that a financial instrument is preferable to a non-financial one, given that the user group responds strongly to financial incentives. Therefore, the goal cannot be more efficiently achieved with a different instrument. The government considers that alternatives, such as subsidies, are less efficient because of the additional cash flows and implementation costs. The expat scheme is consistent with the Dutch payroll tax system in which business expenses can be reimbursed tax free.
In answer to the question of whether the same or a better effect could be achieved at the same cost or less with alternative solutions or instruments, the State Secretary indicated that the scheme generates more revenue for the Treasury than it costs: the revenue generated between 2016 and 2022 was €128.5 million per year on average.
International comparison
The Netherlands was once a frontrunner with its expat scheme, but many other countries have now also introduced or expanded similar schemes. Interestingly, it is the Netherlands that has now cut back on the scheme (shorter duration, salary cap, lower percentage and higher salary criteria) while other countries are actually expanding it (or are considering doing so). European research shows that the Netherlands attracts relatively many knowledge workers, despite a modest tax exemption per user.
Alternatives
Recent evaluations confirm that the present expat scheme is effective and reasonably efficient. No proposals have been made to switch to other tax or expenses arrangements. The government therefore sees no reason for further investigation beyond the regular evaluations.