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    Government to make “cash-for-car” system more flexible

    © Belga
    Henceforth, the “cash-for-car” initiative will be offered to workers who are eligible for the scheme due to the given employer’s policy in this area.
    © Belga

    The federal government will make the rules on being able to exchange your company car for a cash sum (the measure labelled “cash-for-car”) more flexible. The information was reported in the daily La Libre’s Tuesday edition. An SD Worx study had shown in July that the system was of interest to few workers, as it was financially unfavourable.

    In practical terms, this was due to the anti-abuse barriers intended to avoid the measure being used as an instrument for tax optimization. Such barriers will now be lifted.

    According to a bill consulted by La Libre, henceforth the “cash-for-car” measure will also be offered to workers who, up to the point it becomes available, had no company car, but are eligible for the scheme due to the given employer’s policy in the sphere.

    Previously, only workers with a company car when requesting such an allowance were able to claim that they could exchange the vehicle for a cash sum.

    Moreover, cases of “a change of role or a promotion” are also likely to be taken into account for company car eligibility. Some observers are fearing that making the system more flexible will lead to a dramatic rise in requests, and that the majority of net salary increases will then happen by means of this “highway to tax saving”. They fear that there will be losses in social security contributions as well.

    Christopher Vincent
    The Brussels Times