The decision by tax minister Tjebbe van Oostenbruggen to increase the fictive rate used by the tax office to raise money on private assets is a further blow to small landlords and investors, campaign groups said on Monday.

On Friday evening Van Oostenbruggen said he would increase the assumed increase in value by 1.78 percent point, to offset the impact on the treasury of a further delay in asset tax reform.

The government has been told to come up with a new system for taxing assets because the current one does not reflect reality and the ensuing one-year delay means a shortfall of at least €2.5 billion.

To plug the gap, the minister has decided to raise the assumed growth rate anyway – and that could mean 7.66% next year, he told MPs in a briefing.  

This year the assumed return is 6.04% and had been due to go down to 5.88% in 2025.

Small landlords association Vastgoed Belang said the move would be a “bomb under housing policy”, and make it even more likely that landlords will sell off their property.

The move makes investing in housing even more unattractive and will have a “disastrous impact” on landlords, speeding up the sale of rental properties and further reducing supply, said chairman Niek Verra.  

Last year, 12,000 rental properties were lost to the market and that trend is continuing this year, national statistics agency CBS said earlier this month.

Tax advisor Cor Verduin told the Financieele Dagblad that the government could face more court cases if it presses ahead with the plan, having lost two already.

The government was forced to come up with a new system following two major court rulings, which have said the current system based on assumed returns violated the European Convention on Human Rights.

The Supreme Court ruled in 2021 that the system contravened EU legislation and ordered the government to rethink. A revised system was also thrown out by the courts in June.