Draft law modifying the mobility allowance (better known as the cash for car) adopted at first reading by the Finance Commission


Last Wednesday, the Finance Commission has approved at first reading the draft law modifying the Mobility Allowance. The main goals of the changes are to increase the attractiveness of the Mobility Allowance as well as to align it with the future Mobility Budget scheme.

The Mobility Allowance, which entered into force last year, is an optional scheme for the employer that gives the possibility to employees to hand over their company car in exchange of a fiscally attractive cash payment. As we stated in a previous newsflash the most remarkable changes are that the waiting period of one year will be abolished for new hires and that in case of a change of function, the employee may be entitled to a different Mobility Allowance based on a higher (or lower) category of company car linked to the new function. Also note that employees who do not actually have but are entitled to a company car (for example employees that refused their company car) will also be able to claim a Mobility Allowance.

The changes on the Mobility Allowance are expected to enter into force as of 1 March 2019 (just like the Mobility Budget – see newsflash of 18 January).