• Details
    • Service: Tax, International Corporate Tax, Global Indirect Tax, International Executive Services, Global Compliance Management Services
    Type: Regulatory update
    Date: 1/27/2012
    Global - Issues & insights - Articles & publications - TaxNewsFlash

    Belgium - Tax measures in draft law concern capital gains on shares, thin cap rule, and anti-abuse provisions 

    January 27:   An agreement has been reached on a “draft program law” that would include the following tax measures:
    • Benefit-in-kind for company cars: The benefit-in-kind from the private use of a company car would, as from 1 January 2012, be calculated based on a function of the vehicle’s catalogue value and using a formula based on CO2 emissions.
    • Capital gains on shares: The corporate tax exemption available for capital gains on shares would, as from assessment year 2013, be subject to an additional condition that the ownership of shares is held for an uninterrupted period of at least one year. Otherwise, the capital gains would be taxed at a rate of 25%. Capital gains realized by companies subject to the accounting rules for banks and investment entities, on securities that are part of their trading portfolio, would be taxed at the standard tax rate of 33.99%. Write-offs and capital losses on these securities would be fully deductible.
    • General thin cap rule: The deduction of interest on “loans” would be disallowed when (and to the extent of the excess), the total amount of the loan is greater than five times the sum of: (1) the taxed reserves at the beginning of the tax period; and (2) the paid-up capital at the end of this period. The interest deduction limitation would apply if the beneficial owners are established in a “tax haven” or are part of a group to which the debtor is a member. The term “loans” would not include bonds issued by public offering and loans granted by financial institutions. The thin cap rule would be effective on the date of the publication of the law in the official gazette.
    • General anti-abuse provision: The general anti-abuse provision would be revised to include changes to the rules establishing the burden of proof for acts or a series of acts that establish a single transaction, when the transaction is executed based on tax considerations suggesting tax avoidance is the main purpose.

    To read a January 2012 report prepared by the KPMG member firm in Belgium: Government reaches agreement on second set of tax measures



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