{"id":6809,"date":"2008-02-05T01:00:00","date_gmt":"2008-02-05T00:00:00","guid":{"rendered":"https:\/\/www.voyages-d-affaires.com\/belgique-ce-pays-que-lon-taxe-deden-20080205.html"},"modified":"2016-02-10T09:48:57","modified_gmt":"2016-02-10T08:48:57","slug":"belgique-ce-pays-que-on-taxe-deden","status":"publish","type":"post","link":"https:\/\/www.voyages-d-affaires.com\/en\/belgique-ce-pays-que-on-taxe-deden","title":{"rendered":"Belgium The country they call Eden"},"content":{"rendered":"

No wealth tax<\/h2>\n

\"It's not easy to move here. You have to buy a flat and relocate your whole family. It's only profitable for a small minority of really wealthy people\", explains Mr Pr\u00e9vost, a tax expert at Logistica. But for anonymous people as much as for the big bosses of French distribution, former airline bosses or film stars, living 1 hour 20 minutes from Paris has its advantages. And the absence of wealth tax is not the only gift from the tax Samaritan.<\/p>\n

In Belgium, capital gains from stock market investments or the sale of securities are not, in principle, taxable. This is particularly attractive for owners of SMEs who are planning to sell their business, even if this means that they are temporarily resident in Belgium. Many business owners come to Belgium from Germany, the UK or even Japan to carry out this type of transaction. However, there are certain conditions designed to curb excesses: the law specifies that this capital gain must remain within the framework of \"the normal management of private assets\". If the transaction becomes too obviously speculative, it becomes taxable. But only the amount exceeding the normal result of a transaction of the same type will be subject to taxation. For example, a property valued at \u20ac1 million but sold for \u20ac1,100,000 as part of a speculative transaction will only be taxed on the additional \u20ac100,000.<\/p>\n

\"However, in Belgium, the tax advantages are more beneficial to individuals than to companies,\" says Pr\u00e9vost. When it comes to inheritance, for example, things seem to be really interesting for individuals, and above all much simpler. The marginal rate of inheritance tax is 30 % in Wallonia and 27 % in Flanders, but these taxes are very easy to avoid. \"All you have to do is divest yourself of as much of your assets as possible, because unlike in France, manual donations are perfectly legal and are not limited by any ceiling. The only constraint is that these gifts must have been made at least three years before the donor's death. Few people agree to give themselves away. There's a psychological reluctance,\" says Mr D.<\/p>\n

Far from the existential questions raised by inheritance tax, those linked to real estate are much happier. Belgians and non-Belgians alike can rejoice in the gifts of the State. In fact, the cadastral income on which property tax or tax on rental profits is based is exceptionally low, since it is based on criteria established in 1978. For example, for a 200 m2 flat, worth around 500,000 euros at the time of purchase, and earning 100,000 euros a year in rent, the cadastral income will be equivalent to 600 euros and taxed at only 360 euros. And if you consider that property prices in Brussels are 50 % to 60 % lower than in Paris, it's easy to see why it's worth investing in Belgian property. But this cadastral income, which is very favourable to private individuals, does not apply to business premises and offices.<\/p>\n

More than 1,500 French subsidiaries are based in Belgium, but it's certainly not for tax reasons,\" laughs Mr Dub of Fiscalistes et Comptables Associ\u00e9s. It's more that they're interested in the market as such, which is not without its problems, since the French, like Bouygues or Carrefour, hold 20 % of the construction, telephony or retail markets in Belgium.\"<\/p>\n

According to a joint study by Pricewaterhouse Coopers and the World Bank published in November, the tax burden on businesses is extreme, amounting to 64.3 % of their profits, including 57.1 % in social security contributions. Belgium ranks 154th out of 178 countries worldwide in terms of the tax burden on businesses. According to the experts, only a reduction in the Isoc rate (corporate tax rate) could contribute to a better 'world score' for Belgium. This study did not take into account the notional interest deduction, which came into force in 2006.<\/p>\n

Benefits for foreigners<\/h2>\n

This deduction is part of the country's efforts to keep the capital of multinationals within its borders. 20 years ago, Belgium set up \"coordination centres\" to manage the cash flow of large groups. However, as these centres came under fire from the European Commission, the Ministry of Finance introduced 'notional interest', a formula that allows companies to deduct 4 % from their tax base.<\/p>\n

Another way of keeping foreign capital in Belgium is the \"expatriate regime\". Foreigners who come to work temporarily in Belgium for a multinational company benefit from total tax exemption. Although, from a legal point of view, these foreigners are Belgian residents, the administration gives them a status of non-residents which allows them to pay tax in Belgium only on the remuneration relating to their activity on Belgian territory, the rest of the remuneration escaping tax, in Belgium and in their country of origin. This is just one of the tax tricks Belgium uses to maintain a dignified cosmopolitanism.<\/p>\n