Belgian budget 2017 / Tax changes

Written on 24 Oct 2016

The Belgian Government agreed on some tax reforms during the finalisation of the 2017 budget. A larger (mainly corporate) tax reform has also been announced, although the government has not yet come to a final agreement on it (we will keep you informed about this reform).

Below, we summarize some announced tax changes (point A), and give you a preliminary overview of some of the most significant points that are being discussed within the announced reform (point B. There is no political agreement on these points yet. They are still being discussed and cannot be considered to be announced changes).

A. Changes that were agreed upon within the Belgian Government on October 16, 2016

Topic Current regime Announced change
Capital gains on shares by individuals
  • Speculation tax: gains on shares realized
    within 6 months following the acquisition of listed shares: 33% (+ local
    surcharge)
  • Tax on stock exchange transactions: 0.09%/0.27%/1.32%, capped at € 650/800/2,000 on some stock exchange
    transactions
  • Gains realized outside the normal management
    of the individual’s private estate: 33% (+ local surcharge); some internal
    gains which are deemed as falling outside the normal management of the individual’s
    private estate
  • Abolishment of the Speculation tax
  • Tax on stock exchange transactions: Cap will
    be doubled
  • Internal gains: subjected to tax (no further
    details are available at this time; please note that the limited amount of
    income that is to be allocated to this measure in the 2017 budget is : EUR 31million)
Ordinary income
tax rate on interest and dividends for individuals
27% 30%

(applicable as from
2017)

B. Highlights of possible changes with the announced tax reform (no political agreement on these points, they are still being discussed).

Topic Current regime Possible change
Capital gains on shares by individuals
  • Normal management of the individual’s private
    estate: 0%
  • Gains realized outside the normal management
    of the individual’s private estate: 33% (+ local surcharge)
  • Gains on some financial capitalisation
    instruments: qualified (and taxed) as interest
  • {changes still
    discussed}
Corporate
Income Tax
  • Ordinary
    rate
    : 33.99%
  • Reduced
    rate
    for small enterprises (certain conditions apply): progressive rates starting
    at
    24.98%
  • Notional
    Interest Deduction
    : assessed ordinary rate for civil year 2017 (tax year
    2018):
    0.237%
  • Parent-Subsidiary
    Dividends: 95%
    exemption
  • Capital
    gain on shares: 100%
    exemptions (conditions)
  • Ordinary
    rate
    : 23% (as from 2019)
  • Reduced
    rate
    for small enterprises (certain conditions apply): 18% (as from 2019)
  • Notional
    Interest Deduction: suspension
  • Parent-Subsidiary
    Dividends: 100%
    exemption
  • Capital
    gain on shares: 100%
    exemptions (conditions): additional quantitative
    condition, alignment on dividends: participation of at least
    10% or participation
    with an acquisition value of at least EUR 2,500,000