Program law containing measures against trusts and tax haven companies submitted to parliament

On 6 November 2017, the draft bill of program law, containing among others measures to close gaps in tax treatment of trusts and tax haven companies, was submitted to the parliament (see Council of Ministers adopts program law containing measures to close the gaps in the tax treatment of trusts and tax haven companies).

In addition to qualifying distributions by trusts as deemed dividend distributions and measures against layered structures and life insurance structures, it contains the following measures:

1. The introduction of a collective employee profit premium which is solely subject to a solidarity contribution of 13.07% and a tax of 7%. The premium is not deductible in the hands of the employer (as of 1 January 2018).
2. The prohibition of the granting of non-recurring result-oriented advantages in case of collective dismissal (as of 1 October 2017).
3. Gains from Alternative Collective Investment Funds can qualify as deemed interest. The general threshold on fixed income securities held by all investment funds is lowered from 25% to 10% (as of 1 January 2018).
4. Activation of private savings, by reducing, on the one hand, the limit of exempt savings income to 940 euro (assessment year 2018) and, on the other hand, the introduction of an exemption of dividend income on the first 627 euro (assessment year 2018) (as of 1 January 2018).
5. The tax reductions in the personal income tax will be proportional to the duration of the taxable period (as of assessment year 2018).
6. An increase of the tax on securities transaction to 0.035% (general rate) and 0.012% (reduced rate (as of the 10^th day after publication).
7. An increase of excise duties on cigarettes, coffee and non-alcoholic drinks (as of 1 January 2018).
8. The extension of the audit period in case the assessment period is extended due to a violation of the Belgian Income Tax Code and a modification to the provision on the professional secrecy rule (as of the 10^th day after publication).
9. The introduction of a so-called “citizens account”, on which payments of all tax and other administrative debts are being centralised (at the latest on 1 January 2019).

The heavily discussed annual Securities Account Tax has been put into a separate draft bill and is currently under review by the Council of State.