If the move, brainchild of Interior Minister Rita Verdonk, goes through, it will become the first country in Europe to ban the burkha.
Verdonk, a hardliner who has introduced a series of anti-immigration measures, told Dutch Parliament recently that she will investigate the situation under which the curbs on Muslim clothing can be introduced. She has been quoted as saying the 'time for cosy tea-drinking' with Muslim groups was over.
Verdonk's proposal followed a request from right-wing MP Geert Wilders, who claimed the burkha was a threat to security.
Verdonk and Muslim groups have a history of sorts. Recently she called off a meeting with Muslim leaders who refused to shake her hand because she was a woman.
Her controversial proposal, while likely to win parliamentary approval, have left Muslims and human rights groups aghast.
What could come in Verdonk's way is the Netherlands' legislation promising freedom of religion, but analysts say she might work around it by banning the burkha 'in specific situations' citing public safety.
Under this, the burkha is likely to be banned in shops, public buildings, cinemas, train and bus stations and airports, as well as on trains and buses.
The Netherlands' brush with Islamic terror goes back to the murder of filmmaker Theo van Gogh in 2004. Investigations revealed a wide network of Islamic extremists.
But why the focus on burkha?
'It's a safety measure, you don't see who is in it,' a government spokesperson has been quoted as saying. Police authorities second the ban; they are concerned the garb could be used by terrorists for concealment. 'You don't see who is in it,' said a source.
Existing football provisions in the country already ban those covering their face with scarf from entering the grounds.
Muslim groups, however, contend that only a few women wear the burkha and the ban is thus an irritant.
The courts too have not been sympathetic to their cause. Last year a college banned two Muslim women from wearing the burkha during social work and childcare course, and a judge agreed with the college.
The burkha has been the focus across Europe. Many Belgian towns, including Antwerp and Ghent, last year banned wearing it in public. Mussolini's legislation banning concealing one's face in public have been revived by some towns in Italy to levy a fine on bukha-clad women. France and many parts of Germany have banned the hijab, in public buildings, in particular in schools.
The Netherlands has other tough measures in place for immigrants: they must pass an exam on Dutch language and culture before moving to the country. This however does not apply to immigrants from America, Canada, Australia, Japan and other EU states. Legal immigrants already in the country must take a Dutch language course at their expense. Immigrants guilty of minor crimes, such as shoplifting, in their first three years in the country, can be deported. People can bring in a spouse only once they are 24 years old, and are not on welfare. There has also been a clampdown on foreign imams.
Despite these and other such measures, the Netherlands retains its liberal streak. It was the first country in the world, in 2001, to legalise gay marriages. Its rules on euthanasia, or mercy killing, are very liberal.