Supreme Court argues that non-objectors are not entitled to Box 3 legal redress

Christmas Judgment

On 24 December 2021, the Supreme Court ruled that the manner in which the Box 3 levy has been structured since 2017 is contrary to both the prohibition of discrimination (Article 14 ECHR) and the right to peaceful enjoyment of possessions (Article 1 FP ECHR). By way of legal redress, the Supreme Court reduced the income tax assessments for 2017 and 2018 (the years covered by the proceedings) by including only the actual return realised in the levy, but it did not prescribe in general terms how legal redress should be granted.

Principles of legal redress

The government’s basic principle is that compensation will be offered to taxpayers who participated in the collective objection proceedings covering the years 2017 through 2020, and to taxpayers whose income tax assessment for (one of) those years had not yet become final and conclusive by 24 December 2021. Legal redress is provided through the so-called fixed-rate savings option and has been enshrined in the Box 3 Legal Redress Act.

On 6 June 2024, however, the Supreme Court ruled that this legislation, too, fails to stand up to scrutiny. In particular, the calculation regarding the return on assets other than savings balances continues to be discriminatory. A significant difference in tax treatment between successful and less successful investors continues to exist, without a sufficient justification for this. Subsequently, a rebuttal scheme based on actual returns was added to Box 3 with retroactive effect from 1 January 2017, largely based on the rules set out by the Supreme Court in its judgments of 6 June 2024.

No legal redress for non-objectors

This still does not resolve all the issues though. Proceedings are also still pending regarding the question of whether legal redress should be granted to taxpayers whose Box 3 levy for the years 2017 through 2020 had already become final when the Christmas Judgment was pronounced.

On 20 May 2022, the Supreme Court ruled that the Christmas Judgment qualifies as new case law and that, under Article 45aa of the Implementation Regulations to the Income Tax Act 2001, the Tax Inspector is not required to grant an ex officio reduction of an income tax assessment that was already final when the Christmas Judgment was pronounced. This is only different if the Minister of Finance decided to make an exception. However, on Budget Day 2022, the government announced that it would not do so.  

Collective objection plus

As this decision caused quite a stir and with various interest groups taking the position that not all relevant arguments had been put forward in the aforementioned case, in consultation with the Ministry of Finance it was decided to (once again) turn to the Supreme Court and ask the question whether the refusal of ex officio reduction was justified in the given circumstances. To this end, the so-called ‘collective objection plus’ proceedings were introduced (Article 9.7 of the Income Tax Act 2001), which provide for the possibility of also issuing a ‘collective objection’ order for requests for ex officio income tax reductions.

Opinion of Advocate General (AG) Pauwels

On 8 May 2026, Advocate General Pauwels delivered his opinion in two cases, which serve as test cases. In a joint annex to these opinions, the AG discussed all the arguments put forward on behalf of the taxpayers. In short, he is of the opinion that the Court of The Hague and the Court of Zeeland-West Brabant were correct in ruling that the Tax Inspector was not required to grant an ex officio reduction to taxpayers who failed to lodge an objection (on time) against the Box 3 levy for the years 2017 through 2020.

Supreme Court judgment

No excusable failure to comply with the time limit
The Supreme Court confirmed that there was no excusable failure to comply with the time limit. The argument that the government should have better informed its citizens of the need to lodge an objection in order to gain access to the collective objection procedure does not change this. In this case, that need only arose following the judgment of 24 December 2021. By that time, the income tax assessments at issue had already become final and irrevocable.

More generally, the Supreme Court held that a violation of the rights recorded in Article 14 of the ECHR and Article 1 of Protocol No. 1 to the ECHR, as established by a court, does not mean that a Contracting State may not impose limitations on the time limit within which legal redress must be sought. The standard six-week time limit for lodging objections and appeals, and the rules governing excusable failure to comply with this time limit, are consistent with the right to an effective remedy as referred to in Article 13 of the ECHR.

New case law
The Supreme Court then answered the question whether the judgment of 24 December 2021 qualifies as new case law as referred to in Article 45aa of the Implementing Regulations to the State Taxes Act. With reference to its judgment of 20 May 2022, the Supreme Court ruled that this is indeed the case. The Box 3 regime, which has been in force since 2017, differs from the previously applicable scheme to such an extent that the Supreme Court’s previous judgments on the matter, prior to the Christmas Judgment, did not provide a definitive answer. Furthermore, it was not until 24 December 2021 that the Supreme Court felt compelled, for the first time, to grant legal redress itself.

No discrimination
The Supreme Court then addressed the argument put forward by interested parties that the exception for ‘new case law’ is contrary to the prohibition of discrimination. However, our highest court argued that taxpayers who did not lodge an objection – in due time – against the Box 3 levy for the years 2017 to 2020 inclusive, and taxpayers who did so, may not be regarded as comparable cases. No unjustified unequal treatment is in place.

Principle of proportionality
Finally, the Supreme Court addressed the question whether the ‘new case law’ exception is contrary to the principle of proportionality. First, it had to be assessed whether the formal legal principles of due care in preparation and substantiation have been breached. This is not the case. The Supreme Court found that the regulator duly considered the legitimate interests of the taxpayers involved. Then, the Court proceeded to the substantive assessment of the principle of proportionality.

AG Pauwels’ opinion shows that reasons of implementation and budgetary nature formed the basis for the exception to new case law. On top of that, the government highlighted the importance of legal certainty and symmetry with the additional assessment process. Following AG Pauwels’ opinion, the Supreme Court ruled that these are legitimate objectives in the public interest. Given the restraint that the court exercised when assessing political and administrative considerations, it cannot be said that the negative consequences of the exception are disproportionate compared with the objective. Assessment against the ‘fair balance’ requirement under Article 1 of Protocol No. 1 to the ECHR does not produce a different result. In addition, there is no breach of the principles of proper administration. The appeal in cassation is declared unfounded.

Conclusion

The judgment of 25 June 2026 brought an end to a long-running debate about whether taxpayers who did not lodge an objection – in due time – against the Box 3 levy for the years 2017 to 2020 inclusive are also eligible for legal redress through a request for an ex officio reduction. The Supreme Court – once again – answered that question in the negative.

Sources:

• HR 25 juni 2026, 25/02700, ECLI:NL:HR:2026:907
• Opinion AG Pauwels 8 May 2026, ECLI:NL:PHR:2026:456 en 457
• Joint annex to opinions (Gemeenschappelijke bijlage bij conclusies): ECLI:NL:PHR:2026:463