Belgian Finance Minister Didier Reynders said October 19 that the results of the tax amnesty instituted in January have been disappointing. Reynders was expecting tax revenue of â‚¬60 million to â‚¬70 million for the third quarter of the year, but the tax amnesty brought in only € 46.9 million for that period. The amnesty brought in € 17.5 million in tax payments during the first six months of the year. The amount of unclaimed income that has been regularized is approximately € 530 million.
In total, 87 percent of the taxpayers who opted for the tax amnesty preferred to pay a tax of 9 percent, rather than reinvesting their savings and reducing the rate to 6 percent. Only 10 percent of the taxpayers opted for the 6 percent rate, and approximately 3 percent fell somewhere in between.
During the third quarter, banks delivered 1,901 tax amnesty certificates, compared to 151 from stock exchange companies and 2 from insurance companies. Only 38 taxpayers opted to own up directly to tax authorities. The average amount of savings income regularized per taxpayer was € 254,914, but among taxpayers who dealt directly with tax authorities, the average was € 716,566 per taxpayer.
Reynders said he will meet with bank representatives to discuss how to resolve the backlog in processing caused by increased numbers of files. More information will be available around December 20, because the banks must make another payment by December 15.
With just three months to go to the end of the year, Belgian Finance Minister Didier Reynders has lowered his expectations about the outcome of Belgium’s tax amnesty. When the tax amnesty was introduced in January, he anticipated a windfall of about € 850 million, but as of July, the amounts regularized totaled just over € 204 million. (More …)
The Ghent Court of Appeal on 14 September ratified a settlement between Belgian tax authorities and Artwork Systems Group NV under which the Belgian company has agreed to pay more than € 12 million in corporate income tax. The settlement closes all litigation that had been pending before the court of appeal and the Conseil d’Etat (Supreme Administrative Court).
The Ghent Court of First Instance confirmed the tax authorities’ claim against Artwork Systems Group for more than € 58.1 million in 2002. That claim was the result of a construction that enabled the controlling shareholders of Artwork Systems to avoid the Belgian capital gains tax on substantial shareholdings and to make their participation invisible through a string of holding companies in Belgium, Luxembourg, and Panama. (Read the article …)
Belgium adopted a law introducing a private international law code in the Belgian legal system on July 16, 2004. The code is the first complete and coherent codification of the Belgian Private International Law. It contains a comprehensive set of rules determining the international jurisdiction, the recognition, and the execution of foreign decisions and authentic instruments. The code will enter into force on October 1.
An interesting aspect of the code is that for the first time Belgian law deals with the concept of trusts, while Belgium has not yet signed the Hague Convention of July 1, 1985, on the Law Applicable to Trusts and on Their Recognition. This will have an impact on the tax treatment of trusts in Belgium. (Read the article …)