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Box 3 - current developments
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On 24 December 2021, the Supreme Court ruled that the way in which box 3 taxation is structured since 2017 is contrary to both the prohibition of discrimination (Article 14 of the ECHR) and the right to peaceful enjoyment of property (Article 1 of Protocol 1 to the ECHR). The legislator offered legal redress by means of an alternative calculation of returns based on the so-called flat-rate savings variant.
On 6 June 2024, however, the Supreme Court ruled that this legal redress also fails to stand up to scrutiny. In particular, the calculation of returns on other assets is still discriminatory. A significant difference in tax treatment between successful and less successful investors continues to exist, without sufficient justification. This also applies to the Box 3 Bridging Act, as it is based on the same principles. In response, the legislator introduced a retroactive rebuttal scheme based on actual returns in box 3.
Then, in 2025, the ‘Actual Return Box 3’ bill was tabled. This provided for a capital gains tax on immovable property and shares in start-ups and scale-ups, and a capital growth tax on other assets. The latter levy in particular, though, met with significant Senate resistance. So, in late September 2026, this prompted the government to announce its intention to transfer the tax entirely to a capital gains tax. For financial instruments, this transition will take place as soon as the Act comes into force (presumably in 2029). The remaining asset categories will follow in 2030, resulting in a full Box 3 capital gains tax.
