CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. Belgium Reaches Long-Awaited Accord On 2013 Budget

Belgium Reaches Long-Awaited Accord On 2013 Budget

by Ulrika Lomas,, Brussels

27 November 2012

Following weeks of intense negotiations, the Belgian government has finally united on additional revenue- and expenditure-based measures totaling around EUR3.4bn (USD4.3bn), to balance the country's 2013 budget and to reduce the deficit to 2.15% of gross domestic product next year.

The additional fiscal effort will come from a EUR674m reduction in primary spending, from EUR710m in social security savings, from EUR1.067bn in new fiscal measures, and from EUR1.3bn from other initiatives.

The supplementary measures, which are in addition to the initiatives announced in July, are designed to boost both employment and competitiveness in Belgium.

The government plans to preserve and to create jobs by reducing employer contributions by 0.3% or by EUR400m annually, on April 1.

Among the key fiscal measures agreed by the government are plans to increase the taxation of life-insurance contracts, from 1.1% currently to 2% (expected to yield around EUR139m for the state), to tax capital gains from holding companies (generating EUR95m), to increase the general withholding tax to 25% on interest, to revise the notional interest mechanism (generating EUR256m), to increase the excise duty on alcohol and tobacco, and to increase the employer contribution for part-time employment.

Additional revenues are to flow from plans to encourage individuals with undeclared accounts held abroad to regularize their fiscal situation in 2013. A penalty will be imposed on income (15%) and on capital (35%). The measure is forecast to yield EUR513m in 2013. Other revenues will be derived from ongoing efforts to clamp down on tax evasion.

The government confirmed that it has no plans to introduce a crisis contribution, or to increase value-added tax (VAT).

The latest package of stimulus measures is due to be presented to parliament shortly.

TAGS: individuals | compliance | tax | value added tax (VAT) | tax compliance | Belgium | tax avoidance | interest | insurance | budget | excise duty | unemployment | tax rates | withholding tax | social security | tax breaks | dividends

To see today's news, click here.


Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »

Stay Updated

Please enter your email address to join the mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.

To manage your mailing list preferences, please click here »