Gift and Inheritance Tax Act
In order to stimulate cultural entrepreneurship and donations for culture, the Gift and Inheritance Tax Act 2012 (Geefwet) was implemented.
The act covers a number of aspects of fiscal law in order to make “giving to culture” fiscally attractive. The act also introduces a new multiplier of 125 percent which applies to donations made to cultural institutions. Cultural institutions that wish to profit from this ruling have to qualify as a Public Benefit Organisation, or PBO (Algemeen Nut Beogende Instellingen, ANB). An institution qualifies as a PBOonly when at least 90 percent of its efforts are focused on the general good. PBOs are subject to a number of tax advantages:
- A PBO does not pay Dutch inheritance tax or gift tax on inheritances or gifts that the institution allocates to the general good.
- A PBO does not pay Dutch gift tax on gifts that the institution makes for the general good.
- Persons and companies making donations to a PBO may deduct their gifts from their Dutch income tax or corporate income tax. The tax exemption counts for the first EUR 5.000 spent on cultural gifts. Below EUR 5.000, individual persons can deduct up to 125 percent, while companies can deduct up to 150 percent.
In accordance with the Ministry of Finance, former Minister of Culture Jet Bussemaker has extended the Gift and Inheritance Tax Act till the January 1st, 2018.
80 percent of the costs for the maintenance of monuments and gardens is tax-deductible, for buildings listed in the Register of Monuments (Monumentenregister). In September 2016, Minister Bussemaker announced in the Budget Memorandum 2017 (Miljoenennota 2017) that this tax arrangement will be abolished from 2017, but this plan has been postponed for at least a year. The Dutch tax administration has a specific department for tax issues concerning monuments (Belastingdienst Bureau Monumentenbouw BBM).
Volunteers may earn a tax-free extra income of EUR 170 a month maximum, up to EUR 1 700 maximum a year (National Expenses Arrangement – Landelijke Regeling Onkostenvergoeding Vrijwilligers).They do not need to account for their expenses if it does not exceed the former amount. Additional compensation is possible, provided that the organisation reports the compensation to the tax inspector on a yearly basis.
The VAT system is divided into three rates: a high rate of 21 percent, a low rate of 9 percent and a 0 percent rate. EU legislation allows the member states to charge the low VAT rate on tickets for shows, theatres, circuses, funfairs, amusement parks, concerts, museums, zoos, cinemas, exhibitions and similar cultural events and venues. Artists who work on commission, such as writers, composers of advertising jingles, architects and designers, all charge the higher VAT rate.