On 3 July 2026, the Council of the European Union adopted a recommendation outlining the economic, social, employment, structural and budgetary policies it expects the Netherlands to implement under the 2026 European Semester. The non-binding document sets net expenditure growth ceilings for the Netherlands from 2026 to 2030, starting at 4.7% in 2026 and rising to 3.7% in 2030, and calls for reforms in housing, taxation, long-term care, and investment.
The recommendation is part of the annual European Semester coordination cycle, in which the Council issues country-specific guidance to each member state. For the Netherlands, the Council's fiscal prescription requires adherence to a multi-year net expenditure path: 4.7% growth in 2026, 3.5% in 2027, 3.1% in 2028, 3.5% in 2029, and 3.7% in 2030, cumulatively reaching 19.9% above the 2025 base. This follows the EU's reformed economic governance framework, which entered force in 2024 and emphasises country-specific expenditure trajectories over uniform deficit targets.
On housing, the Council urges the Netherlands to increase supply by streamlining planning and permitting processes, which currently take six to seven years, and simplifying building regulations. It also recommends recalibrating regulated rents to better reflect property valuations, a move intended to stimulate the private rental market. The housing recommendations respond to persistent shortages and rising prices that have made homeownership increasingly unaffordable for many Dutch households.
In taxation, the Council identifies unequal treatment across asset types—such as the mortgage interest deduction versus taxation of shares and bonds—as a driver of high household debt and inefficient capital allocation. It suggests considering a transition to a capital growth tax by 2028, which would shift the tax base from notional returns to realised gains. This reform would affect homeowners, investors, and the financial sector, potentially reducing the tax advantage of debt-financed home purchases.
The recommendation also addresses long-term care, where spending is projected to rise from 3.8% of GDP in 2022 to 5.7% by 2070. The Council advises improving cost-effectiveness by aligning co-payments with actual care costs and investing in prevention to curb the increase. This would impact elderly care recipients, healthcare providers, and insurers.
On investment, the Council calls for rapid deployment of cohesion policy funds, particularly for the five priorities identified in the Mid-Term Review, and highlights insufficient research and innovation investment, grid bottlenecks, and labour and skills shortages as barriers to productivity growth. The recommendation is addressed to the Dutch government, which is expected to reflect it in its national reform programme and stability programme. The European Commission will monitor implementation in the 2027 Semester cycle.