Belgian corporate tax reform enacted by Parliament

Written by Philippe Vanclooster 24 December 2017

On 22 December 2017, the Belgian Parliament approved the major corporate tax reform announced in July. The final Act is expected to be published still before the year end. In that way, the majority of the measures can come into force on 1 January 2018.

The corporate tax reform which is now voted is part of the Summer Agreement that was debated in Parliament over the last weeks. The vote of the two other pillars of the reform was postponed to the new year. These two pillars are the annual tax on securities accounts and the measure allowing individual taxpayers to earn some additional income tax free.

The new Belgian corporate tax landscape provides for a positive impulse to Belgium’s international competitive position while demonstrating the importance of tax compliance.

A key pillar is the decrease in the combined corporate income tax rate of 33.99% to 29.58% as from 2018 and to 25% as from 2020. Other positive changes are the increase of the dividends-received deduction from 95% to 100%, the full exemption of capital gains on qualifying shares, and the introduction of tax consolidation.

With year-end closing approaching rapidly, it is important to assess the tax accounting impact of the corporate tax reform, especially under IFRS and US GAAP, where the full deferred tax impact will have to be booked in the financial year 2017 accounts.

On a final note, the government agreed also to abolish the fairness tax as from 2019. This measure is expected to be voted early next year.

For a detailed overview of the measures, visit our tax reform website.

Your local PwC contact can help you assess the impact of the tax reform for your organisation or group. For any specific questions you can also contact Evi Geerts or Maarten Temmerman.