A Belgian Finance Ministry note submitted to Finance Minister Jan Jambon suggests bringing the non-profit sector under corporation tax, a proposal that could become a key issue in the forthcoming budget talks.
According to Het Laatste Nieuws, the note gives Jambon’s N-VA party fresh arguments ahead of negotiations over the federal budget.
The newspaper said the document was drawn up after it reported that Belgium’s health insurance funds had made €1.45 billion in profit from their health insurance activities in recent years without paying tax on those gains.
Those organisations are currently subject to legal entities tax rather than corporation tax, meaning they do not pay tax on the profits they make. Jambon said that if all profit-making bodies were to be taxed more heavily, the same principle should apply to the health insurance funds. He then asked the Finance Ministry to examine how those profits could be taxed, Het Laatste Nieuws reported.
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The note reportedly proposes applying the 25% corporation tax to the entire non-profit sector, including health insurance funds, trade unions, sports clubs and a wide range of non-profit associations.
According to the newspaper, officials have presented Jambon with two options.
Under the first, all associations and foundations would in the future pay corporation tax, with some exceptions such as a turnover threshold of €25,000 before tax becomes due. The second option would tax only the share of income generated through commercial or business activities.
