The mandatory mobility budget that employers in Belgium need to provide to their employees could cost the Federal Government up to €1 billion in lost road taxes and VAT on gas.
From the start of next year, Belgian companies with more than 50 employees that offer company cars will have to offer a mobility budget instead. From 2028 onward, the threshold will be lowered to 15 employees.
According to a study by the consultancy firm EY, the change could cost the Belgian government up to €1 billion in lost revenue from fuel duties, VAT, CO₂ solidarity levies and taxes.
Employees can opt to use the budget to lease a company car, but have more freedom in how they spend it. Instead of a car, people can use it to lease a bike, pay for public transportation, and even use it as financial support for renting or paying off loans on their housing.
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Restricting the company car scheme plays a central part in the ongoing negotiations for the federal budget for next year. Prime Minister Bart De Wever (N-VA) is currently holding talks with coalition parties to find out which measures could be taken to close the deficit by €10 billion.
Federal Minister of Finance Peter Van Peteghem (CD&V) had hinted that removing the scheme was one of the options to close the budget deficit, before being swiftly corrected by his party leader Sammy Mahdi.
Gradually reducing the difference in tax treatment between company cars and ordinary wages would generate significant revenue for the Federal Government, an annual ministerial report advised.
The annual budgetary costs for company cars could fall by €2.8 billion by 2030. For fuel and charging cards, the savings amount to €700 million. Together, that totals €3.5 billion, not including any accompanying measures to make the savings more palatable.
