The 30% ruling is a tax break introduced to attract highly skilled migrants to the Netherlands.
It means that that those who earn at least €37,000 (£32,633, $41,448) a year do not pay tax on the first 30% of their salary for eight years after they move to the Netherlands.
Some 60,000 people currently claim the tax break, with Indian nationals most likely to use it, followed by British, American and Italian expats, reported Dutch News, citing data compiled by research bureau Dialogic shows.
It was originally introduced to compensate for the additional costs foreign workers incur when living and working abroad.
However, the report found that the cost of relocating and living in the Netherlands is well below the 30% and closer to 20%.
Lower cap
The 155-page document, produced on behalf of the Dutch finance ministry, is now calling on the government to cap the salaries, excluding bonuses, that the tax break can apply to.
It also urged the finance ministry to reduce the eight-year period of application to five or six years.
The recommendations come after Dialogic reported that expats on very high salaries – including senior executives and footballers – benefit disproportionately from the tax break
The report states that the policy cost the country’s treasury €755m in 2015 and is set to cost €902m this year.
However, Dialogic ruled out scrapping the tax perk altogether, saying it is an important tool in encouraging highly skilled expats to the Netherlands, and may reduce the competitiveness of the country.
