Netherlands plans 36% tax on unrealized gains

In the Netherlands, a 36% tax on unrealized gains on shares, bonds, ETFs and crypto is being considered (the Actual Return in Box 3 Act, Wet werkelijk rendement box 3, due to take effect 1 January 2028). Real estate and startup equity would be excluded. So: if you buy at 100 and it goes to 200, you would have to pay 36 for every 100 of paper gain even if you don't sell. If it later falls to 50 and you're forced to sell, you lose much more. You can't let your portfolio grow without selling to pay the tax; future value is destroyed and private savings and private pensions are hit, increasing reliance on the state.

Not all assets are treated the same. Real estate and startup participations (companies under 5 years old and with revenue under €30 million) are taxed only when the gain is realized (on sale or transfer). If you hold 5% or more of a company (e.g. founders), you fall under Box 2, not Box 3: you pay 24.5%–31% on realized income only. Angel investors in qualifying startups can also be exempt from the tax on unrealized gains. There is a tax-free threshold (around €1,800 per person per year in the proposal; the Box 3 threshold for 2026 was €51,396). Capital losses can be offset against future gains (above €500), but not retroactively. The bill was passed by the House of Representatives in February 2026 and is awaiting the Senate; the finance minister has said it will be amended, and the governing coalition has committed to moving toward a realized-gains-only system.

You're forced to sell part of your growing assets to pay the 36% on paper gains and also pay tax on the realized gains from that sale. You're taxed twice: on the paper gain and on what you sold. Example: you have €100,000, it goes up to €110,000; you must pay 36% of €10,000 (€3,600) and to pay it you sell, so you also pay tax on the direct gain from the sale. Between tax and broker or bank fees, from €110,000 you can easily end up with €90,000. Result: you can't build up a private pension, and the only asset not hit by this tax is real estate.

If you invest €600 a month in a fund returning 8% a year, compound interest over 50 years can bring you to around €4.8 million. If when you sell you pay a typical capital gains tax (e.g. the state taking 50% of the gain), the tax authority can collect on the order of €2.5 million and the saver still has a large pot. If instead a 36% tax on unrealized gains is applied and you're forced to keep selling and paying that tax year after year, plus tax on realized gains, over the same 50 years you don't even reach €1 million: the state collects around €800,000 and you're left with around €900,000. The chart below compares wealth over time when investing €600/month at 8% a year for 50 years: without a tax on unrealized gains vs with a 36% tax on unrealized gains.

National capital can fall by 50–60% over 50 years. Tax revenue rises at first but in the long run falls by around 50% compared with a scenario where capital is allowed to grow and tax is only levied on realization. The tax can be self-defeating: revenue is high initially but the tax base is eroded. Those who can leave move to other countries; those who can't pay more. And because the only asset not touched is real estate, you either get capital flight or a housing boom. If other countries copy the model, Europe could become fiscally unsustainable within decades.