On 16 August 2021, Assuralia, the Belgian professional union of insurance undertakings introduced an action for partial annulment of article 4 of the law of 17 February 2021 (Official Journal of 25 February 2021) introducing an annual Tax on Securities Accounts (TSA) in the Belgian Code of Various Duties and Taxes (CVDT). The role number is 7623 (NL).
As per recent financial press articles and a previous press release from Assuralia (dated 28 December 2020), the main issue is obviously the application of the TSA to securities accounts held by Belgian life insurers in the framework of their unit-linked life insurance products (“Branche 23” / “Tak 23”).
As a recall, the TSA is in principle not due in respect of a securities account held by an insurance undertaking “provided that no third party (…) has a direct or indirect claim (“droit de créance” / “vorderingsrecht”) on the value of the securities account held” (art. 201/4 (4) CVDT).
However, according to the parliamentary works, securities accounts held by an insurance undertaking in the framework of unit-linked life insurance contracts (“Branche 23” / “Tak 23”) would not benefit from such exemption “since the holding of a portfolio by means of a unit-linked life insurance contract and an underlying securities account is fully equivalent to the direct holding of a securities account” and insurance contracts are “never held on a securities account” (see previous coverage).
This action from Assuralia unfortunately illustrates the difficulty to interpret a tax legislation which uses undefined concepts to provide for exemptions which should be of strict interpretation, such as “direct or indirect claim on the value of the securities account” (art. 201/4 (4) CVDT), “direct or indirect holding for own account of the securities account” (art. 201/4 (5) 1° CVDT) or “holding of rights on a securities account” (art. 201/4 (5) 2° CVDT).
The explanations provided in the parliamentary works are far from being clear, and the examples provided not meant to be exhaustive. This gives rise, in the absence of any public guidelines from the Belgian tax authorities and as pointed out by Assuralia, to tax uncertainties.