Employers’ organization AWVN thinks that an increase in the tax-free kilometer allowance is too expensive for the treasury
In 2006 you paid about one and a half euros for a liter of petrol. The price for a liter of diesel was around the euro. That was the year that the tax-free kilometer allowance was set at 0.19 euros per kilometre. If an employer reimburses more, then wage tax must be paid on it. That’s why most companies just keep 19 cents. We are now fifteen years later and petrol prices have increased significantly, but the tax-free kilometer allowance will remain the same, also in 2022. Nu.nl.
Mileage allowance in 2022 will remain the same because cycling is not more expensive
The extra costs due to the high fuel prices therefore come out of the employee’s pocket, as many companies keep the 19 cents. The reason that the government does not want to increase the tax-free kilometer allowance is because the allowance is not only for fuel, but also if you come to work by bike. “Compensating for increased fuel prices would mean that you would also reimburse, for example, cycling or walking, even though the costs have not increased there,” a spokesperson for the Ministry of Finance reported. Nu.nl.
It is somewhat crooked, because fines in 2022 will increase in line with the consumer price index, but the tax-free kilometer allowance will not. The spokesperson cannot explain the reason behind this. Employers’ organization AWVN thinks the reason is clear: ‘Calculations by the ministry, which we were also able to see, show that every cent of increase costs the treasury 130 million euros.’
How high should the tax-free kilometer allowance be?
The Business Drivers’ Association already stated last year that the 19 cents should be 24 cents based on inflation. The association goes even further and believes that the mileage allowance should depend on the catalog value of the car. A larger car consumes more, usually costs more to maintain and is likely to depreciate more. This results in three new kilometer allowances. For a car more expensive than 40,000 euros, the kilometer allowance should rather approach 50 cents per kilometre.
