The Belgian government has just announced that the scope of the Belgian Tax on Stock Exchange Transactions (‘TOB’ or ‘beurstaks’) would be extended in order to also cover ‘foreign platforms’. This announcement is part of the budget agreement presented last Sunday.
As a recall, the application of the tax to foreign platforms has raised many discussions over the past years in the absence of a clear answer provided in legal text. In 2011, the State Secretary stated that transactions in which foreign brokers registered with the Belgian financial regulator (FSMA) intervene should be subject to the tax. The same year, an opposition party submitted a bill of law the purpose of which was to extend the scope of the tax, but that bill has never been adopted.
Now, it seems that the Belgian government clearly wants to end that discussion and tax transactions carried out on foreign platforms by Belgian investors (non-residents being in any case exempted). Technically speaking, it is still unclear how this modification to the scope of the tax will be legally achieved and, more importantly, enforced.
In addition, the taxation ‘ceilings’, which set the maximum tax due per transaction (EUR 650, EUR 800 or EUR 2,000) and depend on the tax rate applicable (0.09%, 0.27% and 1.32%, respectively), would be doubled.
Foreign brokers – and, more generally speaking, foreign financial institutions carrying out securities transactions for the account of Belgian investors – should closely monitor the concrete implementation of this announcement and assess its implications appropriately.
Financial institutions already concerned by the tax should make sure that the modification to the taxation ‘ceilings’ will be implemented in their systems correctly and in a timely manner.
Any questions? Do not hesitate to contact Olivier Hermand.