Corporate Tax News Issue 64 - November 2022

One-time windfall tax to be levied on fossil fuel companies for 2022

On 10 November 2022, the Dutch lower house of parliament approved  a bill (Temporary Solidarity Contribution Act) that would impose a one-time “solidarity contribution” (colloquially known as a “windfall tax”) on companies liable to corporate tax in the gas, oil and coal sectors (the bill will now move to the upper house). The government wants to impose an additional levy on companies that have benefited disproportionally from the significantly increased energy prices. Revenue from the windfall tax is estimated at EUR 3.2 billion and would be used (amongst others) to cover the costs of compensation measures for households. The windfall levy would apply only for (fiscal) year 2022 and is based on the recent EU regulation that introduces a temporary windfall tax and mandate reduced consumption of electricity (see also the item in Corporate Tax Bytes) and for other articles on recent windfall taxes, see the August 2022 issue of (Corporate Tax News).

The levy

“Contributors” (taxpayers) to the solidarity levy would be Dutch corporate income taxpayers that derive at least 75% of their turnover from economic activities related to hydrocarbon extraction, mining, petroleum refining or coal manufacturing during their 2022 financial year (“contribution year”). The levy would be set at 33% of the “excess profit,” defined as taxable profit, as determined under the regular corporate income tax rules, that exceeds 120% of a “reference profit.” The reference profit would be the average taxable profit of the entity in the four years preceding the contribution year.


The bill contains the following example:

A BV derives 80% of its turnover from the extraction of natural gas in 2022 and generates a taxable profit (after remittance under the Mining Act) of EUR 150 million. The taxable profit according to the Dutch corporate income tax in the past four years was as follows:

  • 2018: -/- EUR 30 million (loss)
  • 2019: EUR 10 million
  • 2020: EUR 20 million
  • 2021: EUR 100 million

The reference profit is EUR 25 million (the average of the last four years). The excess profit is EUR 150 million -/- (120% x EUR 25 million) = EUR 120 million. The solidarity contribution due, therefore, would be 33% of that or EUR 39.6 million.

Interaction of mining excise duty and corporate income tax

On Budget Day 2022, the government also proposed to temporarily (for years 2023 and 2024) increase the mining excise duty for gas producers in the Netherlands. The solidarity contribution would be on top of that for 2022. Although the payment under the Mining Act is deductible for corporate income tax purposes, the bill stipulates that the solidarity contribution would not be a deductible expense for corporate income tax purposes.


The solidarity contribution is designed so that contributors would need to file a tax return, which means that contributors would have to calculate and remit the solidarity contribution to the Dutch tax authorities. The return would have to be filed (no earlier than) 17 months after the end of the contribution year (financial year 2022), with the contribution paid at that time. Penalty provisions and tax interest would apply. Tax interest could be charged in case of a deviating tax assessment (the interest rate is the same as for corporate income tax, i.e., 8%).

Retroactive effect

As the solidarity contribution would be due for financial year 2022, it would apply retroactively to 1 January 2022. According to the government, retroactivity is permissible in these special circumstances and there is no conflict with international law.

Mark Laeven

Michel Ruijschop