The Dutch Tax and Customs Administration, along with the benefits agency, has officially abandoned plans to migrate to Microsoft 365. Instead, the organizations will transition to self-hosted infrastructure and European open-source software solutions to maintain control over their digital environment.
By 2027, the agencies aim to migrate email and scheduling systems to local servers. Between 2027 and 2028, document storage and collaborative tools will also be replaced by open-source alternatives. This strategy aligns with recommendations to avoid vendor lock-in and diversify critical business software.
The shift is supported by recent expansions in the agency's data center capacity. While existing software licenses will be utilized to minimize costs, some information governance features currently in Microsoft 365 lack direct local replacements, with solutions to be defined in future reports.
Digital sovereignty efforts also impact VAT system upgrades. The agency is moving away from external vendors, leading to project delays: the VAT-refund system is now set for April 2027, and the domestic VAT system is pushed to the third quarter of 2027.
Currently, 55% of the agency's IT resources are dedicated to modernization, 40% to regulatory compliance, and only 5% to innovation. By the end of 2028, officials expect to reduce modernization efforts to under 20% while increasing innovation capacity to over 20%.
