Sunday, 29 January 2017
Over the last five years, multinational companies have pulled around 144 billion euros out of their Belgian branches. The use of notional interest is dropping fast, L’Echo and De Tijd reported on Saturday.
In 2011, there was almost 336 billion euros spread between 25 Belgian branches of AB InBev, Hewlett-Packard, BP, France Telecom, Engie, BASF, Carrefour, Philips, Total, EDF, etc. Today, that figure has dropped to 192 euros. In five years, around 20 multinational companies have pulled around 144 billion euros out of Belgium.
This is explained by three things, according to fiscal law professor Axel Haelterman (KUL). On one hand, the current notional tax rate – 0,237% – is much too low to be of any real benefit. On the other hand, the possibility of using “hybrid” structures to compensate this is a real one. Finally, numerous multinational companies have anticipated the change in the notional interest system with a project to reduce tax for Belgian businesses.
Professor Haelterman recommends a rapid reduction in tax for Belgian businesses. “This way, we could attract more multinational companies so they will invest in our real economy and not in the financial economy. It’s obvious.”