As part of the recent government agreement, the new Belgian government has introduced a series of proposed changes in indirect taxes aimed at supporting sustainability, enhancing transparency, and simplifying the tax system. Below are the key highlights designed to create a more efficient fiscal environment that aligns with climate objectives, reduces administrative burdens, and combats tax fraud.
1. Near real time reporting
As part of Belgium’s ongoing efforts to digitalise the tax administration and reduce VAT fraud, near real-time reporting of VAT invoice data will be introduced in 2028 for transactions between Belgian VAT taxpayers and those involving cash registers.
- System features & impact: Cash registers, payment, and invoicing systems will be directly connected to the tax administration, enabling the automatic transmission of transactional VAT data. It will provide VAT authorities with transaction-level insights, significantly enhancing their data mining capabilities and audit efficiency. This change will lead to increased scrutiny and accountability for taxpayers.
- Compliance simplifications: Abolishment of the yearly client listing and review of the daily receipt book and various VAT registers in view of potential simplification or abolition.
- Broader context: This new compliance obligation complements the mandatory B2B e-invoicing requirement (for most transactions between Belgian VAT taxpayers), which will take effect on
1 January 2026, and should be viewed against the backdrop of a broader e-invoicing and e-reporting wave, including the EU’s VAT in the Digital Age initiative. In addition, on 1 July 2030, mandatory B2B e-invoicing and near real-time reporting for intra-EU transactions will be introduced, with the abolition of recapitulative statements (EC sales listings) based on the ViDA initiative.
Over the next few years people, processes, and technology will need to adapt to the above critical milestones. It will be crucial for companies preparing for the upcoming B2B e-invoicing changes, to already take the end ambition of the government (real-time reporting) into account when defining their strategy, selecting technology and reviewing the impact on data availability and accuracy.
2. VAT
The VAT reforms are designed to drive key initiatives:
- Sustainability and Green Initiatives: To encourage energy-efficient heating solutions, the VAT rate for supplying and installing heat pumps will be reduced from 21% to 6% for the next five years. The VAT rate for installing fossil fuel boilers, such as gas and oil, in homes over 10 years old will increase from 6% to 21% and the VAT rate on coal will rise from 12% to 21%, aligning it with other fossil fuels.
- Substantial impact on the real estate sector: The scope of the 6% VAT rate for demolition and reconstruction projects will be expanded to include supplies, with a revised surface area criterion reduced from 200m² to 175m². To provide clarity on VAT application and new building concepts, the government will establish a precise definition for renovation and reconstruction and will consider future implementation of sustainability requirements.The proposal to replace the 6% and 12% VAT rates with a single 9% rate has been abandoned, benefiting real estate projects that rely on the 6% rate.
- Consumption and fight against waste: The conditions for donating commercial goods to approved institutions will be relaxed (by amongst others reviewing the list of eligible products), while maintaining the right to VAT deduction.
- Legal Security and fight against Fraud: For all ongoing tax audits and disputes, taxpayers will have direct access to the inspector or the service in charge by establishing a standardized communication system. When imposing VAT fines, mitigating circumstances will be considered if there is no loss to the Treasury.
3. Excise measures
- Modernized and codified Excise Legislation: All existing excise laws will be incorporated into a single, clear Excise Code, making the legislation more transparent and eliminating anomalies.
- Tobacco Products: Excise legislation will consider new tobacco variants and alternatives, focusing on their health and societal impacts, with potential increases in duties on classic tobacco products and alternatives.
- Non-Alcoholic Beverages & Packaging: National excise duties on “zero” beverages, coffee (the question remains if this would focus on the sugar-level in these categories of non-alcoholic beverages, which would be in line with other countries in the EU), and tea will be abolished. The packaging levy on water will be lowered, with the levy for reusable packaging being abolished. In addition, the packaging levy could also be lowered for products which are, on average, more expensive in Belgium than in neighbouring countries.
- Energy Products: Excise duties will be used to reduce dependence on fossil fuels, with competitive advantages for professional diesel being maintained but reduced. The excise on electricity would be lowered to a European minimum for Belgian companies and transmission network tariffs for the electricity-intensive industry would be lowered to the same level as neighbouring countries.
4. Other Green taxes
In line with the EU’s Green Deal, Belgium is introducing green taxes to support the transition to a low-carbon economy, including the implementation of the Carbon Border Adjustment Mechanism (CBAM) and a commitment to the expanded EU Emissions Trading System (ETS).
5. Customs reforms
The Belgian government acknowledges the crucial role that Belgian customs services play in Europe, contributing to the economy and ensuring safety. To enhance the efficiency and competitiveness of Belgian ports and logistics hubs, the government is implementing several customs reforms:
- Modernization and Simplification: A 24/7 service will be established and a new general law on customs and excise will be developed, focusing on administrative enforcement rather than penal enforcement, enhancing client focus and attracting more investments.
- Enhanced Coordination: Improved coordination between customs and other public services, such as the AFSCA and regional administrations, will be established to streamline import and export processes through a centralized digital platform with real-time status updates.
- Facilitated Tariff Information Requests: The process for requesting ‘BTI’ – binding tariff information will be simplified to minimize disputes.
- AEO status: The Authorised Economic Operator status will be improved with a focus on trade facilitation.
Businesses engaged in international trade should prepare to leverage these changes to optimize their operations and capitalize on new opportunities in the Belgian market.
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The above reflects a high level (and non-limitative) summary of the various indirect tax measures included in the federal government agreement. Additional details regarding most of these measures can be expected in the near future (as they will have to be converted into the applicable laws accordingly).
For more insights on the impact of these possible changes, please do not hesitate to reach out to Ellen Cortvriend, Emilie Vandermeuse or your regular PwC contact.
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