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Sep 22nd
Home arrow taxbites


New Penalty System for Tax Offenses Takes Effect

Written by Marc Quaghebeur Monday, 29 October 2012

On 22 October, the Belgian State Gazette published the Act of 20 September 2012 introducing the “una via” principle in tax matters and increasing criminal penalties in tax matters.

In 2009, the federal parliament decided to investigate why tax evasion cases worth billions of euros in taxes petered out after protracted court proceedings. The parliamentary commission ‘in charge of investigating major tax evasion cases’ came to the conclusion that the way the tax authorities and the public prosecutor’s office were working together to combat tax fraud was outdated. The commission made a number of recommendations to improve the fight against tax fraud (read the full article).

More Guidance on Belgiumís General Antiabuse Rule

Written by Marc Quaghebeur Monday, 10 September 2012

The Belgian program law of March 29, 2012 has replaced the general antiavoidance rule by an antiabuse rule. The GAAR was introduced in the income tax, registration tax, and inheritance tax codes in 1993 but had proven ineffective. The new rule must combat abuses of tax avoidance schemes, but even after Finance Minister Steven Vanackere published a first practice note, there was a demand for some examples of transactions that the tax authorities considered abusive tax avoidance.
On July 19, the tax authorities published a second practice note that gave a list of examples regarding the inheritance tax and registration tax. (read the full article).

Pension Regime, Thin Capitalization Rule Amended

Written by Marc Quaghebeur Monday, 06 August 2012

The Belgian State Gazette on June 28 published a June 22 program law containing various direct and indirect tax measures. The bill amends Belgium’s new thin capitalization rule and the tax regime for pension contributions and pension income (read the full article).


Can Belgium Negotiate New Income Tax Treaties?

Written by Marc Quaghebeur Monday, 16 April 2012

Because of its position on bank secrecy rules, Belgium found itself on the OECD gray list of tax havens in 2009. Finance Minister Didier Reynders announced that Belgium would raise the level of information exchange and that his department would start negotiations with its foreign counterparts. At the same time, he announced that Belgium would opt for exchange of information under the EU savings directive.

Belgium’s Ministry of Finance started accelerated negotiations with more than 80 states to sign new income tax treaties, protocols, or tax information exchange agreements that contain a provision for exchange of information that complies with the international standard of article 26 of the OECD model tax treaty.  By July 2009 Belgium had  reached the threshold of 12 TIEAs required and was promoted to the OECD’s white list. In total Belgium has signed 52 treaties and protocols.

However, none of these treaties and protocols has entered into force even though quite a few have been approved by the Belgian Parliament. In fact the entire treaty ratification process came to a halt in 2010 after the Council of State5 commented on the bills for the ratification of these agreements and pointed out that these income tax treaties were ‘‘mixed’’ treaties.  (read the full article).

Budget Tax Bills Enacted

Written by Marc Quaghebeur Monday, 06 February 2012

Barely three weeks after Prime Minister Elio Di Rupo was sworn in, the Belgian Parliament on December 28 adopted two bills implementing some of the tax measures announced in the 2012 budget. The bills were signed into law by King Albert II and published in the Belgian State Gazette on December 30.

On January 26 the government submitted a new bill to Parliament that would introduce some of the remaining tax measures and correct some provisions in the 2011 laws. (read the full article).

Court Seeks Preliminary Ruling on Participation Exemption

Written by Marc Quaghebeur Monday, 02 January 2012

The Antwerp Court of Appeal on November 22 requested a preliminary ruling from the Constitutional Court on whether Belgium’s tax regime for dividends received by a Belgian company — and in particular the limited carry forward of the unused surplus — is constitutional. (read the full article).

Belgian Politics and the 2012 Budget

Written by Marc Quaghebeur Monday, 05 December 2011

Belgian Socialist Party leader Elio Di Rupo, who is in charge of forming a new government, announced on November 27 that he has clinched the 2012 budget. There is no way back. On November 25 Standard & Poor’s downgraded Belgium’s credit rating from AA+ to a mere AA. This could lead to higher interest rates and a downward financial spiral.

Belgium has been without a government for more than 535 days, and Prime Minister Yves Leterme’s caretaker government has been looking after the shop. In June King Albert II put Di Rupo in charge of forming a government. On October 11 Di Rupo presented the so-called ‘‘Butterfly Agreement,’’ which details the rules that will redefine the shape of the Belgian state and the balance of powers between the federal and regional governments, as well as the new mechanisms for financing the federal and regional governments. The agreement also will enact a limited transfer of taxing powers to  the regional governments.

The last obstacle Di Rupo faced was an agreement by all future government parties on the 2012 budget. Di Rupo favored more taxes while the conservative parties wanted structural reforms in the job market and the pension system. (read the full article).

Capital Gains, Bank Secrecy Rules Updated

Written by Marc Quaghebeur Monday, 21 November 2011

The Belgian State Gazette on November 10 published the law of November 7, 2011, which updates rules relating to the taxation of capital gains on fixed assets, bank secrecy, and wage withholding tax (read the full article).

Belgiumís Taxation of Capital Gains

Written by Marc Quaghebeur Monday, 08 August 2011

One reason for Belgium’s popularity in international tax-planning structures is the absence of capital gains tax for individuals. Belgium does not have a wealth tax, either, so that makes the country attractive for wealthy individuals.

The financial newspaper De Tijd reported on June 8 that the Supreme Court of Justice had dealt a serious blow to the tax-exempt regime of capital gains realized by an individual on his shares of a company. This gives us an opportunity to review the current rules regarding Belgium’s capital gains tax regime.  (read the full article).

Belgian Official Puts Reforms on Table

Written by Marc Quaghebeur Monday, 11 July 2011

The Belgian State Gazette on November 10 published the law of November 7, 2011, which updates rules relating to the taxation of capital gains on fixed assets, bank secrecy, and wage withholding tax.

At a July 4 news conference in the Belgian Parliament, Walloon Socialist Party leader Elio Di Rupo, recently appointed by King Albert II to lead the formation of a coalition government, announced a five pronged reform package that includes numerous new tax proposals.

Di Rupo, as the newly appointed formateur, has asked the other political parties to decide whether they want to pursue government formation talks on the basis of the proposals. (read the full article).

New Developments For Belgiumís Dividends Received Deduction

Written by Marc Quaghebeur Sunday, 20 March 2011
The Antwerp Court of Appeal recently rejected a Belgian company’s claim that the participation exemption (the Belgian dividends received deduction) conflicts with the EU parent-subsidiary directive. Meanwhile, the Belgian government has introduced a bill in Parliament that would further ease restrictions of the participation exemption (read the full article).
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