Taxes and fees of regional water authorities in the Netherlands

The Dutch water management system is fairly unique in the world due to the comprehensive water quantity regulation through dykes and artificial waterways and its linkage with water quality regulation. The existing levy system is based on principles of cost recovery and ‘stakepay-say’ (i.e. strong stakeholder participation and more influence for those who pay levies). The peculiarities of the levy base clearly had a strong impact on businesses’ behaviour in the past, investing in their own water treatment plants to avoid payment of levies. Moreover, the levy also seems to have contributed to innovation in the waste water treatment sector. Although the Dutch water levy system seems to be working quite well, as identified in a 2014 OECD report there remain opportunities for further improvement and an evaluation of the system is currently underway.