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Evaluation of the 30%-ruling: Professions and nationalities (part 2)

On August 11, 2017 by Dutch Umbrella Company

In this second part of our two-part blog on the report of the 30%-ruling we will continue reviewing the 30%-ruling report conducted by Dialogic. We will mainly focus on which nationalities particularly are using the 30%-ruling, in which professions it is mostly commonly used and the importance of it. Do people still want to work in the Netherlands if there was no 30%-ruling? Curious about what we discussed in our first blog about the report? Here you can read the first part about how other countries in Europe facilitate their tax legislation regarding 30%-ruling and who the users of the 30%-ruling are.

Industry in comparison with nationality

As you can see in the figure below the nationalities are fairly homogeneously distributed across the sectors. In many cases, there is no strong match between having a particular nationality and working in a particular industry. However, this does not apply to the relatively large group (16% in 2015) Indians. Of the 30%-ruling users working for a company focused on developing, producing and publishing software, nearly half of them has the Indian nationality. For companies that advise on IT, this is more than 40%. A relatively large proportion of users of the 30%-ruling with a German, Chinese or Italian nationality are working within an university or higher education.
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Profession users 30%

Scarcity in the Dutch labor market

In the second figure above you can see that for a group of around 74% of the users of the 30%-ruling, the report stated that they are working within certain scarce professions. These groups of users are broadly defined, so assessing the scarcity of individual occupations based on these groups is less pure. Nevertheless, the figure show that a large number of users work in scarcity professions, such as ICT, technology, research and top management. The other 26% the report can not directly match to a profession which is scarce. This does not mean that this group of users has no specific expertise in which there is scarcity in the Dutch labor market. These employees may have other forms of specific expertise. For example, in this remaining group there are many managers, which it is conceivable that the offer of such managers on the Dutch labor market is insufficient.

Wages 30%-ruling users compared to wages from ‘regular’ employees

Price can be seen as an economic indicator for scarcity. As the demand goes up and / or the offer goes down, the price will rise. This thinking can also be projected on employee wages: as an employee is scarcer, wages will be higher. In order to get an indication of the scarcity of the 30%-ruling users, the report compared the wages of the 30%-ruling users to the wages of regular employees in the Dutch labor market.
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30% users

Impact 30%-ruling

The proportion of respondents from the report who are saying that the 30%-ruling had a significant / immense impact on their decision to get to the Netherlands is larger for the higher income. For example, in the group of employees earning less than €50.000 a year, a very small decrease would occur if the 30%-ruling no longer existed. For the group earning more than €100.000 almost two-third of it would not come to work in the Netherlands if there was no tax legislation like the 30%-ruling.

Questions?

In the first blog we discussed how other countries in Europe facilitate their tax legislation regarding 30%-ruling and who the users of the 30%-ruling are. You can read it here. In this second part we informed you more about the nationalities and professions. If you would like to read more about the report go to the website of the Dutch Government*. Would you like to know more about the 30%-ruling? Don’t hesitate to contact us, send us an email at [email protected] and we’ll answer any questions you might have. Do you want to read more about the 30%-ruling? Read our page about the 30%-ruling in the Netherlands for more information about conditions and financial consequences.

*For more information about the report you can visit the website of Dutch government. You can read the full report here, but be aware the report is written in Dutch. For more information, contact us at +31 20 820 15 60.