|
- 21/05/2012
Belgium Warned Of Further Austerity Ahead
- 16/05/2012
Belgian Residents Stifled By Hollande's Tax Plans
- 14/05/2012
Funds In Line For French Tax Refunds
- 02/05/2012
ECJ Rules Against Dutch Tax On Cross-Border Car Use
- 24/04/2012
Belgian Media Owe Millions In Unpaid Gambling Tax
More
Belgium Tax News »
Treaty Update:
Belgium - Vietnam
23/3/2012
According to preliminary media reports, Belgium and Vietnam signed a Protocol to their 1996 DTA on March 12, 2012.
Treaty Update:
Congo, Democratic Republic of the - Belgium
10/1/2012
According to preliminary media reports, the DTA signed between the Democratic Republic of Congo and Belgium in 2007 was ratified on December 24, 2011.
Treaty Update:
Congo, Democratic Republic of the - Belgium
19/10/2011
According to preliminary media reports, the parliament of the Democratic Republic of Congo adopted legislation on October 11, 2011 ratifying the DTA signed between Congo (D.R.C.) and Belgium, signed in May 2007.
More
Belgium Tax Treaty Updates from TreatyPro »
Belgium Knowledge Base
- Belgian
Co-Ordination Centres
- Belgian
Special Expatriate Fiscal Regime
- Belgian
Holding Companies
Belgium has a corporate
income tax rate of 33.99% (including a 3% so-called
'crisis surcharge') and has never been considered a
financial center. However in order to attract the headquarters
of foreign multinational companies Belgium accords favorable
tax treatment to entities known as "co-ordination centers"
(currently being phased out). It also offers a low-tax
regime to expatriate employees with specialist skills,
and has a relatively benign holding company taxation
regime.
On
1st January 2006 Belgium introduced a 'notional interest
deduction', taking effect in tax year 2007, which allows
all companies subject to Belgian corporate tax (including
Belgian branches of foreign companies) to deduct from
their taxable income an amount equal to the interest
they would have paid on their capital in the case of
long-term debt financing.
At
the same time, the 0.5% registration duty on capital
contributions was abolished.
The calculation of the tax deduction begins with the
‘equity capital’ as stated in the company’s
opening balance sheet of the taxable period. Based on
Belgian accounting law, ‘equity capital’
includes capital, share premiums, revaluation gains,
reserves, carry-forward of profits or losses and capital
investment subsidies. The notional interest rate is
set each year and follows the average annual 10-year
government bond rate. The law sets a maximum deviation
of 1% from one year to the next and a maximum percentage
of 6.5%. The government may change these percentages
by Royal Decree.
The
notional interest deduction does not discriminate between
companies and complies fully with existing Belgian and
EU law. Discussions with EU authorities have taken place
and the measure is compatible with EU State Aid rules
and the Code of Conduct.
The
2010 Budget
In
October, 2009, the Belgian government unveiled key details
of its 2010 budget, containing both a series of new
tax initiatives, as well as provisions extending certain
stimulus measures already in application.
Endeavouring
to find a delicate balance between maintaining support
for the country’s economy, while at the same time
retaining careful control of the budgetary situation,
the government categorically ruled out any increase
in the existing tax burden on employment, and also attempted
to maintain the purchasing power of individuals at the
same level.
Specifically
designed to support employment, key measures highlighted
in the budget affecting value added tax (VAT) included
the following:
- From
January 1, 2010, the government decided to reduce
to 12% the rate of VAT within the catering industry.
In return, the government is requiring a commitment
from employers regarding employment. After one year,
the government intends to re-evaluate the measure,
with a view to then reducing the rate yet further
to a possible 6%.
-
The reduced 6% VAT rate, already in application in
the construction industry, was extended until March
31, 2010. The reduced VAT rate applies to all work
for which an application was submitted before this
date.
Other tax initiatives included in the Belgian government’s
2010 budget included the following:
- Determined
to support the agricultural sector, and in particular
the milk industry, the government announced its commitment
to granting around EUR20m to the sectors in the form
of tax reductions.
-
The government increased the amount of tax-deductible
childcare costs for severely handicapped children.
-
The government decided to raise duties on diesel,
a measure which it was thought would generate in the
region of EUR140m.
Belgium’s Employment Minister, Joëlle Milquet,
welcomed the proposals, highlighting in particular the
importance of the government’s decision to reduce
VAT in the catering and construction industries.
|