On 22 December 2017, the Belgian Parliament approved the major corporate tax reform that announced in 26 July 2017.
The main proposal was related to gradually reduction of corporate income tax rate. Currently, the normal rate is 33.99% and this will be reduced to 29% in 2018 and 2019, and will further reduce to 25% in 2020.
Small and medium-sized enterprises will be entitled to a reduced tax rate of 20% as of 2018 on that part of the taxable profit not exceeding 100,000 EUR, otherwise a 25% tax rate will apply under the current rules.
On 27 October 2017, according to a press release, on the proposal of the Minister of Finance, the government has granted a 100% participation exemption on dividends (current 95%) as of 1 January 2018. Capital gains on shares will also be 100% exempt as of 2018. The separate tax rate of 0.412% on capital gains on shares (holding period more than 1 year) will be eliminated.
Finally, the Federal Government agreed also to abolish the fairness tax as from 2019. This measure is expected to be voted early next year.
