Author: Pieter Deré (PwC)
Publication date: 30/09/2020
Today, 7 political parties reached an agreement on the formation of a new Belgian government (the so-called Vivaldi government).
While the last edits are being made to the agreement, the broad outline is becoming clear. The agreement mentions the intention for a relance and investment plan of 4.7 bln EUR including measures with important social accents. To provide the necessary budgetary room for this plan, some important tax measures are part of the agreement.
A first important measure relates to the taxation of digitalised companies and the introduction of a minimum tax for businesses. Belgium will constructively support the international initiatives at EU and OECD level in respect of the Pillars and taxation of the digital economy. International agreement is preferred but if no action is taken at international level by 2023, the intention is to proceed with the necessary measures unilaterally.
Next, during the term of the government, an important tax reform (with a particular focus on the personal income tax side) will be prepared which should be realised in 2024. In combination, the fiscal amnesty procedure would be terminated by the end of 2023. The tax reform does not seem to include a capital gain tax or securities tax (although it does mention that a fair share of contribution is expected from the wealthiest – with respect for entrepreneurship), but rather puts emphasis on the combat against tax and social fraud. Further details are currently unknown.
The Belgian tax reform of 2017 has brought important structural changes, combining a broader tax base with a reduced overall tax rate. It will be important to maintain those benefits and preserve them while new ideas will be assessed in the coming weeks and months.
There are a number of important social challenges ahead for the government, for instance the climate challenge and corresponding objective of creating an emission free car fleet by 2026 . Inevitably, there will be a fiscal impact of the measures addressing those challenges, e.g. in the tax rules dealing with company cars. The impact will become more clear in the weeks and months ahead.