In a major u-turn, the cabinet has abandoned plans to make being in the Netherlands without proper papers a criminal offence, following pressure from coalition partner Labour.

In return for dropping a key part of the coalition accord, Labour has agreed to give a bigger tax break to people earning over €40,000 a year.

Labour MPs had remained opposed to the plan to make it a crime to be an illegal immigrant, despite its inclusion in the coalition agreement. ‘This was a measure which kept following us and continued to hurt us,’ Labour leader Diederik Samsom said on Tuesday, after the change of heart was announced.

Middle class

In return for dropping the proposal, Labour has agreed to increase the tax break for people earning between €40,000 and €110,000 year, giving them extra income of some €300 a year.

This measure will cost the treasury some €500m. The money will be found by making extra cuts in next year’s spending plans, if that proves to be necessary.

Defence, security and infrastructure will not be affected, whatever happens, the VVD said in a reaction.

Senate

ChristenUnie leader Arie Slob said earlier dropping the proposal to make it a criminal offence to be in the Netherlands without a permit would be key in deciding if his party can continue to support the coalition government in the upper house of parliament. The coalition does not have a majority in the senate and relies on opposition party backing.

Slob and D66 leader Alexander Pechtold have welcomed the decision to scrap the plan. ‘I am glad the cabinet is no longer sticking with this erroneous political gesture,’ Pechtold said.