The Federal Government of Belgium has recently come to an agreement on the tax measures in the Budget 2013. This includes changes to the corporate tax rate and the withholding tax rate. There are also some indirect tax measures but those are not yet final.
The upcoming changes are summarized below.
Corporate tax rate
The calculation of the rate of the notional interest deduction (NID) for 2013 (assessment year 2014) will be based on the average 10-year government bond (OLO) rates in the third quarter of 2012 which may result in a NID rate for 2013 of 2.742% (+0.5% for SMEs). Capital gains on the sale of shares, realized by large companies and holding structures, will be subject to a separate 0.4% tax from 2013, increased by a 3% crisis contribution. For corporate tax purposes the tax will not be deductible.
Withholding tax rate
The withholding tax rate for movable income will be increased from 21% to 25%. Liquidation proceeds will be taxed at the rate of 10% as before. The mandatory reporting of movable income in the tax return and requirement to communicate information to a central contact point will be repealed. Dividends paid by a real estate company will be subject to a withholding tax rate of 15%. The wage withholding tax on temporary unemployment benefits will also be increased.
