The application of the VAT exemption for hospital and medical care in the Netherlands has been restricted from 1 January 2013. 

The Dutch variant of the VAT exemption of article 132 (1) (b) EU VAT Directive is connected with the Dutch Act for Professions in Individual Healthcare (Wet beroepen in de individuale gezondheidszorg or "wet BIG"). The wet BIG has been set up to facilitate and ensure the quality of Dutch healthcare, and contains several educational requirements and a list of registered and protected medical professions.

The connection to the wet BIG remains after 1 January 2013. However, the rules for determining whether a certain type of healthcare is VAT-exempted have been changed.

Until 31 December 2012, the VAT exemption included medical care practised by a medical professional without a BIG registration but with the same (demonstrable) quality level as a BIG professional carrying out the same medical activities.

The VAT exemption also included medical activities performed by a BIG professional, but performed on the basis of a complementary education which is not regulated by the wet BIG (e.g., a BIG professional performing alternative medical treatments).

Both medical activities mentioned above will be subject to 21 percent VAT from 1 January 2013. In addition to this, the list with medical professions recognised by the wet BIG has been limited. Certain professions (e.g., certain types of psychologists) are excluded from the VAT exemption.

In summary, the VAT exemption will (only) remain applicable to BIG professionals supplying medical services within the scope of the BIG-recognised education of the professional.

Some thoughts

One might argue that the fact that medical care practised by a medical professional without a BIG registration but with the same quality level as the BIG professional is excluded from the VAT exemption, is not in accordance with the fiscal neutrality principle which states that similar (medical) activities from similar quality should be treated the same way (for VAT).

Another point of attention is the fact that some generally accepted types of medical care, such as acupuncture, are excluded from the VAT exemption.

Finally, we realise that giving content to this VAT exemption can never be fully objective. Somewhere the boundaries for application of the VAT exemption have to be settled. As a result, certain medical activities will either way be subject to VAT.