Dutch Government Expands WBSO Tax Credit to Boost Innovation in 2025
The Hague, Friday, 6 December 2024.
The Netherlands increases WBSO tax credit for 2025, enhancing support for employer-led innovation, while independent entrepreneurs remain excluded from benefits.
Enhanced Support for Innovation
The Dutch Parliament has approved significant changes to the Research and Development Promotion Act (WBSO) for 2025, increasing the tax credit percentage from 32% to 36% for R&D costs up to €380,000, while maintaining 16% for costs above this threshold [1]. For startup companies, the support is even more substantial, with the first bracket percentage rising from 40% to 50% [1]. This expansion represents a €100 million investment in innovation support, funded through a 0.04% increase in employer contributions to the disability insurance fund (Aof) [1].
Strategic Position in European Innovation
The Netherlands continues to strengthen its position as a prime location for innovation within Europe, with this tax credit expansion adding to its already attractive business environment. The country’s strategic location provides access to 170 million consumers within a 500km radius [3], while its highly educated, English-speaking workforce (90% of the population) makes it particularly attractive for international innovation projects [3]. The Dutch market ranks fifth in the 2022 IMD Competitive Index for global connectivity and innovation [3].
Impact on Business Development
This enhanced WBSO scheme particularly benefits employers in key sectors such as biotech, high-tech industries, and life sciences [2]. The expansion is expected to accelerate innovation cycles, with companies utilizing these opportunities showing improved development timelines [3]. However, it’s important to note that self-employed entrepreneurs (ZZP’ers) will not benefit from these enhancements, maintaining their current fixed deduction of €15,551, with an additional €7,781 for starters [1].
Implementation Timeline
While the Lower House has approved these changes [1], it’s crucial to note that the proposal still requires final approval from the Dutch Senate [1]. The implementation is planned for 2025, aligning with broader government initiatives to strengthen the Netherlands’ position as a leading innovation hub [alert! ‘Final Senate approval pending’].