The Myth of Prosperity: Who Truly Benefits in Curaçao?

The Myth of Prosperity: Who Truly Benefits in Curaçao?

January 15, 2025

At the start of my studies, I learned that the goal of the state—or government—is to strive for the greatest possible happiness for the largest group of people. One way to achieve this is by keeping social and economic disparities in check. There’s a link between the economy and public finance in this endeavor. A key function of public finance is income redistribution to prevent inequalities from growing too large. This is why our tax system is progressive: the wealthy pay more taxes, while those with lower incomes pay little or none.

However, recent developments in Curaçao beg the question: are we moving closer to this ideal or drifting further away?

On January 14, 2024, two reports in the Algemeen Dagblad grabbed my attention. First, Curaçao achieved a tourism milestone, welcoming over 700,000 stayover visitors in 2024, with December alone surpassing 70,000. Second, MP Zita Leito proposed that 275 million guilders from tax revenues be invested in education, IT, and clean energy.

On the surface, these seem like positive developments. But how do they align with the reality that Curaçao has become the poorest country within the Kingdom of the Netherlands? This claim is sup-ported by comparing our GDP and Gini coefficient, measures that reflect income inequality.

Let’s take pensions as an example. Curaçao’s old-age pension (AOV) is the lowest in the Kingdom—just 862 monthly guilders. Sint Maarten offers 1,380 guilders, and St. Eustatius leads with 2,763 guilders.

Meanwhile, Aruba is implementing progressive tax reforms. Residents earning less than 30,000 guilders annually pay no income tax, while those earning up to 60,000 guilders pay only 21%. In Curaçao, however, the tax system remains less favorable despite increases in minimum and youth wages. Inflation is also rising, which further erodes any gains.

Tourism may be booming, but the benefits appear unevenly distributed. Around 80% of Curaçao’s population earns less than 3,000 guilders monthly. Of the 90,000 vehicles registered on the island, 25,000 owners have failed to pay motor vehicle taxes for 2024, likely because they simply can’t afford it.

And what about the wealthy? Despite writing off 3 billion guilders in tax debt, mainly of the well-off, new tax debts have already accumulated the same amount.

Finally, while homeowners could benefit from reduced property taxes (OZB), the government has yet to implement this relief. Meanwhile, civil servants, pensioners, and other groups receive one-off payments, creating an illusion of progress while structural inequality remains unaddressed.

A troubling picture emerges: a society where inequality deepens, and there’s no clear vision for achieving the greatest happiness for the largest group. The government’s actions seem reactive rather than proactive, favoring temporary fixes over long-term solutions.

Is this truly the best we can do for Curaçao?

Miguel Goede