The Dutch government has found a way to make investing less appealing than leaving your money in a savings account earning 0.1% interest. Starting in 2028, the new Box 3 (wealth tax) system will tax the increase in value of your stocks, bonds, and crypto, whether or not you actually sell them. This shift from taxing fictional returns to taxing paper profits has sparked a grassroots revolt among retail investors who see their long-term financial plans evaporating.
What Box 3 Actually Means for Your Wallet
The current system taxes you on a fictional return of around 6% on your assets above €57,000. The new system announced by the Belastingdienst (Tax Authority) changes the game entirely. Instead of a wealth threshold, you get a profit threshold of just €1,800 per year. Any returns above that, real or unrealized, get hit with a 36% tax.
For anyone with basic index funds returning 6-8% annually, the math is brutal. With €30,000 invested, you’re already crossing the taxable threshold. A portfolio of €50,000 at 6% return generates €3,000 in “profit”, meaning you owe tax on €1,200. That’s €432 in tax on money you haven’t touched.
The petition at box3eerlijk.petities.nl, which has gathered thousands of signatures, frames this as a direct attack on property rights. Their argument is simple: you can’t tax money people haven’t received while forcing them to bear 100% of the risk if markets drop.
The Math That Makes Investors Furious
One Reddit user ran the numbers on a typical FIRE (Financial Independence, Retire Early) scenario. Starting with €50,000 and adding €750 monthly for 30 years at 8% average returns:
- Without the new tax: You end with €1,113,000
- With the new tax: You end with €848,000
That’s a €265,000 difference, nearly a quarter of your wealth gone. The government collects €56,000 less in total tax over those 30 years because you have less capital generating returns. Everyone loses.
The compounding effect, what Dutch investors call the “sneeuwbaleffect” (snowball effect), gets destroyed. Annual taxation reduces the capital base that future returns are calculated on, creating a permanent drag that only gets worse over time.
This becomes even more absurd when you realize the tax applies to nominal returns, not inflation-adjusted ones. In a year with 10% inflation, you might pay 36% tax on a 10% “gain” that leaves you poorer in real terms.
Why This Hits Young Investors Hardest
The €1,800 profit threshold sounds reasonable until you realize it translates to roughly €22,500-30,000 in invested capital. Young professionals just starting to build wealth will hit this limit within their first few years of investing.
The current system’s €57,000 wealth exemption allowed young people to accumulate a decent starter portfolio before Box 3 kicked in. The new system punishes them precisely when they’re in the critical accumulation phase.
Many investors report they’ll be forced to sell holdings just to pay the tax bill. As one commenter noted, “You’re being punished for managing your money responsibly.” This creates a liquidity crisis where you must liquidate investments, potentially at market lows, to satisfy a tax claim on paper profits.
The irony is that the truly wealthy, with assets in the millions, can structure their wealth through Box 2 (corporate holdings) or international entities, leaving the middle class to shoulder the burden. The petition explicitly calls this out, noting that households with over €2 million often use structures that avoid Box 3 entirely.
The Political Calculus: Why It’s Happening Anyway
Despite near-universal criticism, a majority of the Tweede Kamer (Second Chamber) appears ready to vote yes. The reason? A €2.4 billion annual budget gap if they don’t implement it by March 15, 2026.
The VVD, CDA, JA21, BBB, and PVV are all reluctantly supporting it, calling it a “necessary evil” and a “stepping stone” toward a proper capital gains tax that only taxes realized profits. D66 and GroenLinks-PvdA actively support taxing paper profits, with GroenLinks-PvdA MP Luc Stultiens arguing it “won’t lead to billions in budget losses and is easier to implement.”
The government claims it wants to tax only at sale, but says that’s not feasible by 2028. So instead, they’re implementing a system that even they admit is flawed, hoping to fix it later. Investors aren’t buying the promise.
Email templates circulating on Reddit show organized resistance. One detailed message to D66, seen as a key supporter, lays out 12 technical objections, from legal questions about taxing non-existent profits to concerns about capital flight and damage to startups needing risk capital.
The Escape Routes (and Why They’re Flawed)
Faced with this tax, many investors are considering drastic measures:
Stop investing and pay down mortgage: This becomes attractive if mortgage interest deduction also disappears. But as one commenter warned, aggressive mortgage repayment could trigger the “verhuurgenotbelasting” (rental enjoyment tax) if you later rent out the property.
Move everything to pension accounts: Pension beleggen (pension investing) avoids Box 3, but comes with strict withdrawal limits and rules. The maximum periodic payout is €27,192 per year, and you can’t access it until retirement age.
Invest through a BV (private limited company): This Box 2 route makes sense at around €100,000+, but adds administrative costs and complexity that small investors can’t justify.
Leave the Netherlands: The calculation showing €6.6 million more wealth after 40 years by moving abroad is stark. The petition claims a €200,000 portfolio at 10% returns would grow to €9 million tax-free elsewhere versus €2.4 million in the Netherlands.
The problem is these “solutions” either lock up your money, add bureaucracy, or require wealth you don’t yet have. They’re not real options for the average investor with €30-50k trying to build a nest egg.
The Real-World Consequences
The new system creates perverse incentives. Short-term traders who realize profits within a year can avoid some tax impact, while long-term buy-and-hold investors, the kind who provide market stability, get punished year after year.
It also creates a compliance nightmare. The Belastingdienst must value every citizen’s investment portfolio annually, including illiquid assets like crypto and private equity. Errors will be common, and appeals will flood the system.
Perhaps most damaging is the signal it sends: the Netherlands is now less attractive for capital than neighboring countries. Belgium is moving toward realization-based taxation. Germany already has it. The Netherlands is going the opposite direction, risking capital flight when the EU is trying to deepen its capital markets.
The image above captures the everyday reality: ordinary people in ordinary apartments trying to build financial security, now facing a tax system that treats their modest investment accounts like hedge funds.
What Happens Next
The parliamentary vote must happen by March 15, 2026, to meet the January 1, 2028 implementation date. Investors are flooding politicians with emails, but many feel it’s futile. As one Redditor put it, “They’ve made up their minds. Fuck the citizen.”
Yet there’s a glimmer of hope. The Eerste Kamer (First Chamber) could still reject the bill, and legal challenges are certain. The petition argues the tax violates property rights under the European Convention on Human Rights. Courts have already struck down the old Box 3 system, there’s precedent for doing it again.
For now, young investors face a choice: continue investing and accept the drag, find creative workarounds, or join the growing chorus demanding the government tax profits only when they’re real.
Bottom Line
The Box 3 reform was supposed to fix an unfair system. Instead, it’s creating a new one that punishes the very behavior the government should encourage: long-term saving and investing. The math doesn’t lie, this costs investors hundreds of thousands over a lifetime while reducing total tax revenue.
If you’re building wealth in the Netherlands, understand exactly how this hits your portfolio. Run your own numbers. Consider whether the traditional FIRE path still makes sense under these rules. And if you disagree with taxing paper profits, the petition is still open, and politicians are still reading their emails, at least for now.
The Dutch have a word for this: “beleidsarmoede” (policy poverty), when political expediency trumps sound design. In this case, it’s your retirement that pays the price.
