In times of economic recession, it is still important to work on protecting and improving the state of the environment. If a company does not have the budget for environmental measures, it could consider applying for an environmental subsidy or tax benefit. In the Netherlands there are several subsidies and tax benefits available, discussed below in this article. However, companies may want to act fast, as the Budget Memorandum (Miljoenennota) of 2011 points out that the Dutch government intends to cut spending. This may result in a reduced budget for the subsidies and tax benefits discussed below.
The Indicative Rule random writing-off and investment deduction environmental investments (Meldingsregeling milieu-investeringsaftrek 2001) consists of two lists: the Environment List Indicative Random Writing-Off Environmental Investments (VAMIL-list) and the Environmental Investment Deduction (MIA List). MIA and VAMIL both have the goal of stimulating investment in environmentally-friendly products.
The MIA and VAMIL lists have a great deal of cross-over and are virtually identical, but are two separate fiscal incentives. As a result, most environmentally-friendly products and processes are eligible for fiscal incentives under both schemes.
VAMIL provides liquidity (cash flow) and interest advantages to companies by allowing delays in payments of tax through the random writing-off of certain environmentally-friendly investments. MIA is a fiscal-deduction rule, under which 15%, 30% or 40% of certain environmental investments are deductible from pre-tax profits.
In order to qualify for the list, products must be new, must offer significant improvements in environmental efficiency and must have a broad application potential. This means that the tax benefits only apply to industrial equipment that can make a substantial improvement to the environment.
The capital equipment to which the lists apply, include superior technology in the following fields:
– Sustainable means of production;
– Climate change;
– Air pollution;
– Nuisance and health;
– Mobile tools and means of transport;
– External safety and preventive provisions;
– Bio-diversity and natural surroundings;
– Saving on raw materials and re-use; and
– Waste flows.
More information about MIA/VAMIL is available via the following link in Dutch: http://www.senternovem.nl/vamil_mia/index.asp.
Subsidies for environmental technology
The Rule on Subsidies for Environmental Technology (Subsidieregeling milieugerichte technologie) has the overriding goal of developing more environmentally friendly technology through the provision of subsidies. Projects for which subsidies are available must involve at least one party based in the Netherlands and have to meet the objectives of the Program Environment and Technology (Programma Milieu en Technologie). These objectives are aimed at Small and Medium Enterprises (SMEs) in the Netherlands and involve environmentally-targeted innovations initiated by the industry or innovations within the industry. Applications for this subsidy need to be submitted to Agency NL (Agentschap NL).
More information about subsidies for environmental technology is available via the following link in Dutch: http://www.senternovem.nl/milieutechnologie/subsidies/index.asp.
The Rule Green Projects 2010 (Regeling groenprojecten 2010) is a tax legislation measure, and is intended to encourage the public to accumulate savings by granting a tax benefit to savers who invest money in green funds. The Rule Green Projects 2010 applies to, amongst others, the following investment projects based in the Netherlands:
– Nature. This includes investment projects focusing on the development and maintenance of forests and projects focusing on the development and maintenance of new nature and landscape values.
– Agriculture. Includes projects focusing on sustainable dairy farming; greenhouses with low energy consumption and low environmental impact for cultivating horticultural crops on a commercial basis; and sustainable breeding of fish and shellfish.
– Recovery and reuse. Includes other projects focusing on CO2 capture, transport and storage, detoxification and dismantling of ships, recovery and reuse of certain materials.
– Sustainable energy. Includes projects focusing on generating renewable energy from wind and solar energy, hydropower.
– Energy saving. Includes projects focusing on energy saving by means of heat pumps, heat/cold storage, low energy exterior lightning, useful application of residual heat, etc.
– Sustainable construction. Includes projects focusing on building or renovating houses and non-residential buildings that meet specific criteria concerning material use, insulation, indoor climate and energy/water conservation.
A project can receive a low-interest grant if it is necessary to protect the environment, including nature and forests.
More information about ‘green projects’ is available online via the following link in Dutch: http://www.senternovem.nl/groenbeleggen/.
Sustainable energy production (SDE)
The Decision stimulation of sustainable energy production (Besluit stimulering duurzame energieproductie – SDE) aims to promote the generation of energy from sustainable sources. Anyone who produces energy in a sustainable manner is eligible for subsidies. However, private individuals can only claim subsidies for solar panels. Applications can be submitted for solar panels, wind energy on land, biomass, waste incineration, landfill gas or biogas from waste water or sewer water purification installations, water power and combined heat and power sources. Under the Rule on subsidies for wind energy at sea 2009 (Regeling windenergie op zee 2009), applications can be submitted for generation installations that produce renewable electricity using wind energy at sea. Applications for the aforementioned subsidies need to be submitted to Agency NL.
More information about SDE is available online via the following link in Dutch: http://www.senternovem.nl/sde/index.asp.
Energy investment deduction (EID)
The Energy Investment Deduction (EID) was introduced by the Implementation Rule Energy-Investment Tax Deduction 2001 (Uitvoeringsregeling energie-investeringsaftrek 2001) and is designed for businesses who want to invest in energy-saving techniques and the application of renewable energy in their company. Under the EID such investments can double as a business advantage. Not only do businesses save on energy costs, but they will also pay less income or corporation tax. Applications for EID need to be submitted to Bureau Investment Rule and random writing-off (Bureau investeringsregeling en willekeurige afschrijving (IRWA)).
More information about EID is available online via the following link in Dutch: http://www.senternovem.nl/eia/index.asp.
Subsidies for energy and innovation
Under the Subsidy Rule Energy and Innovation (Subsidieregeling energie en innovatie) subsidies can be given to projects/research on energy saving, sustainable heath for existing houses, sustainable biomass import, investments for reduction electricity connection of heat pump holders, covering risks of geothermal heat, biomass gasification, gasification and wind energy on the sea. Subsidy applications need to be submitted to Agency NL.
More information about the Subsidy Energy and Innovation is available online in Dutch: http://www.senternovem.nl/eos/.
Subsidies for vehicles
Under the Subsidy Rule for motor vehicles with diesel motors and right to return on BPM, a subsidy of EUR 400 is available for vehicle owners of motor vehicles with diesel motors that emit less-polluting gases (for example NOx).
More information about the Subsidy for motor vehicles with diesel motors is available online in Dutch:
These environmental subsidies and tax benefits provide companies in the Netherlands with opportunities to protect or even improve the environment. In many cases, adopting these measures will result in multiple benefits – reduced business costs through improved efficiency as well as environmental benefits.
EHS Regulatory Consultant