Dutch Prime Minister Mark Ruta announced on Friday that his administration would step down, accepting responsibility for years of mismanagement by the tax authorities, much of which was focused on ethnic discrimination.

Ruta said he had handed his resignation to the Netherlands king villain Alexander, but the Cabinet will remain in place in a caretaker capacity for now, with an election already scheduled for March 17.

A parliamentary inquiry found last month that officials at the tax service had wrongly accused families of fraud over child care subsidies.

The report said around 10,000 families had been forced to repay tens of thousands of euros in what is called unprecedented injustice.

The tax office said last year that many of the families were targeted based on their ethnic origin or dual nationalities.

Orlando Kadeer, an attorney representing around 600 families in a lawsuit against politicians, said people had been targeted as a result of ethnic profiling.

Bureaucrats picked out their foreign looking names, according to Padilla, Prime Minister Mark Rutte, ER said.

It is never acceptable for someone to feel they're being discriminated against based on nationality, race, gender or sexual orientation.

It is absolutely unacceptable in a law based state.