Belgian finance minister questions new capital gains tax
Wednesday, 08 June 2016
The tax will generate less revenue than expected and reduce the tax on stock exchange transactions. “Amend, cancel or replace the tax on speculation? These are to options to be studied,” said Van the finance minister, Johan Van Overtveldt (N-VA), on the margins of a working meeting in New York.
The so-called speculation tax is part of a package of tax shift measures which were adopted by the federal government in October 2015, aiming at reinforcing job creation and purchasing power in Belgium.
The tax was introduced for resident and non-resident taxpayers. A tax rate of 33 % is due on capital gains realized within six months of purchase (outside the exercise of a professional activity) on quoted shares, options and warrants or other quoted financial instruments.
The finance minister is concerned that the impact of the speculation tax will be negative in the end.
“Preliminary figures indicate that the tax is no success,” he said. “The revenues remain below what had been estimated in the state budget. We see also a negative impact on revenue from the tax on stock exchange transactions.”
This analysis is in line with previous concerns, but a quantitative assessment will only be available in the coming weeks. The finance industry was skeptical about the tax from the very beginning.
“If the assessment will show that the direct and indirect effects of the speculation tax are negative, I’ll be the first one to defend the idea that we must do something about it,” Johan Van Overtveldt said.