Sunday, 04 December 2016
The tax shift the Federal government has put in place will reduce employer’s salary costs, especially for lower salaries. This will allow Belgium to become more competitive. Deloitte spoke of this in the 7th edition of its European salary study.
This means Belgium is now in fourth place on the most expensive countries table this year. This includes every salary level. Belgium was in second place last year, Deloitte has said. Belgium is in 7th place on the most expensive countries table for low salaries, which is in the middle of the table.
The Deloitte study also shows that Belgian workers earn less than their European counterparts. “Belgium is losing ground in Europe with regards to net salary. The cause is a high marginal rate (53.5%) for very low salaries (38,080,01 euros). Other countries also apply a marginal transfer rate, but only for higher salaries”, the audit and council cabinet said. They added that a marginal 50% rate is not unusual among the countries studied.
On the other hand, the married Belgian taxpayer whose partner doesn’t earn is taxed less than single workers, thanks to the quotient conjugal principal. “Compared to other European countries, Belgian offers the biggest tax advantage for lower salaries. For higher salaries, we are still doing better than most of Europe, but Switzerland, Luxemburg, and France are doing better than us”, Deloitte said.
Belgium does “relatively well” with the tax advantage given to workers that have children.
As far as disposable income goes, meaning net salary with housing and other benefits deducted, Belgian workers are generally less well off than their Luxemburg and German neighbours. They are, however, better off than the French and Dutch. Deloitte says the cost of housing and living in Brussels is lower than in other nearby capital cities.
The study also shows that the Belgian tax on savings is higher than the European average. The tax rate on capital (interest, earnings) has been 27% since the 1st of January 2016. It will be 30% from the 1st of January 2017.