Dutch Tax Agency Halts Microsoft 365 Cloud Plan, Turns to On-Premises and Open Source

The Netherlands’ Tax and Customs Administration has dropped its planned Microsoft 365 public-cloud rollout after an ICT assessment raised concerns about security, sovereignty and vendor lock-in. The government will retain existing Microsoft software for now, while moving mail and calendars on-premises in 2027 and introducing European open-source storage and collaboration tools later.

Slashdot has reported:

The Netherlands’ Tax and Customs Administration has abandoned its planned Microsoft 365 public-cloud rollout, replacing it with an on-premises and open-source approach. The government had planned to move to Microsoft 365 in 2025 and finish by the end of 2026. About 5,000 employees had migrated before the plan was paused in July, following a recommendation from the Dutch Advisory Council on ICT Assessment in June.

The assessment cited concerns about information security, information processing and future-proofing. It identified the routing of confidential documents through American servers, reliance on standard Microsoft encryption instead of Double Key Encryption, and insufficient end-to-end encryption for Teams calls. It also flagged vendor lock-in, reduced flexibility, digital sovereignty concerns and the lack of an adequate exit strategy as dealbreakers.

The government is not replacing all Microsoft Office software with one open-source suite. Existing Microsoft programs will remain in use for now, including Outlook in the planned on-premises mail and calendar environment. The open-source transition is intended to cover personal storage and collaboration, rather than replacing Word, Excel, PowerPoint or the entire desktop environment.

State Secretary for Finance Eelco Eerenberg outlined the schedule in a letter to Parliament: “In 2027, the provision for mail and calendar will be realized on-premises. Later in 2027 and 2028, European open-source solutions for personal storage and collaboration will follow. This allows us to work toward a sustainable and more autonomous solution for these functionalities.”

The decision comes as European organizations place greater emphasis on digital sovereignty. At the Open Source Summit Europe, the Linux Foundation released its 2026 State of Open Source in Europe report, which found that 94 per cent of European Union organizations consider digital sovereignty important and 61 per cent consider it very important. Linux Foundation Europe general manager Thierry Carrez said in his keynote, “Europe has clearly heard the message on digital sovereignty.”

In an onstage interview at the summit, Linux Foundation board chair Nithya Ruff said the issue extends beyond Europe: “Digital sovereignty is a need that the entire world feels, whether it's Sierra Leone or the US or China.” The Netherlands is also examining a broader shift from Windows and proprietary software to Linux and open-source programs across government.

Other Dutch government agencies are developing an open-source alternative called DAWO, or Digital Autonomous Work Environment for Government. Its initial step would be replacing Windows with NixOS, a Linux distribution. The Tax and Customs Administration’s announced plan, however, keeps Microsoft software in place for the time being as it moves selected services on-premises and later adopts European open-source solutions.