Mortgage interest deductibility and homeownership in the Netherlands

Abstract

This paper considers the growing amount of mortgage interest paid in the Netherlands against the background of its full fiscal deductibility, increasing homeownership rates, innovation in the mortgage market, and changes in the Dutch income tax system. Its main conclusion is that arguments in favor of fiscal deductibility are weak. Since the deductibility puts pressure on the income tax base, it is likely that sooner or later the facility must be limited or abandoned. © Springer Science+Business Media B.V. 2007.