Regulations: complexity and pressure
Dutch companies have been pointing out for years that the regulatory burden is high. Examples include extensive reporting requirements in the area of sustainability (CSRD), strict labour legislation and tax reporting. Compared to Germany or Belgium, for example, the administrative burden in the Netherlands is relatively high, although the digitisation of government services does offer some relief.
Tax burden: above the European average
The total tax burden in the Netherlands is above the EU average. Companies not only pay corporation tax (19% or 25.8%), but also relatively high employer's contributions and levies. By way of comparison, Ireland and Eastern European countries have significantly lower rates, which makes their investment climate more attractive. This puts Dutch companies at a competitive disadvantage, especially in sectors with narrow margins.
Wage demands and the labour market
Due to the tight labour market, wages are rising sharply. Wage agreements in the Netherlands are among the highest in Europe, with collective labour agreement increases reaching 6%. Although this supports purchasing power, it increases the cost base for employers. In countries such as France and Spain, wage pressure is considerably lower, giving companies there more scope to invest.
Inflation: pressure on margins
After peaking in 2022-2023, inflation in the Netherlands has declined, but energy and raw material prices remain high. Dutch companies have fewer opportunities to pass on higher costs to customers than their German or Scandinavian counterparts. This increases pressure on margins and liquidity.
Consequences for credit risk
The combination of high regulatory pressure, tax burdens, labour costs and inflation makes Dutch companies more vulnerable. Compared to many other European countries, margins are thinner and competition is more intense. This is an important consideration for credit insurers: the risk of payment problems or bankruptcies is increasing, especially in sectors with low buffers.
What pays?
The Dutch business community is strong and internationally oriented, but the current mix of regulations, cost increases and tax pressure is putting pressure on earning capacity. Compared to other European countries, the Netherlands operates in a relatively difficult climate. It is therefore worthwhile for entrepreneurs to closely monitor risks and protect themselves against unpaid invoices, a role in which credit insurance is proving its value more than ever.