Don't forget that Brussels is the de facto capital of Europe which brings quite some economic activity this way that otherwise wouldn't be here. The fact that Holland sits on about 25% of the EU natural gas reserve makes a difference in how you have to organize your taxes. We have too many governments, in a needlessly redundant fashion, and each and every one of them step waay too much outside of their boundaries. Income tax Income tax must be paid by all people who have settled in Belgium or made it their centre of financial interest, regardless of their nationality. So income tax seems ridiculously high in Belgium. each year and we experienced a lot of financial insecurity. Are there any tax breaks associated with being an expat? If you live in NL you live a different life style to the one you have in BE. I have the same feeling but would like to see the comparison in depth. Patrick Derthoo, a tax expert at Deloitte in Brussels, Belgium, said income taxes in the country are unusually high but things are starting to change. (20 hour contracts or bust). We do not get what we pay for. Belgium drops down from second to third on the list of countries most heavily taxed in Europe and gains 10 days of TAX freedom with respect to 2017, where the Tax Liberation Day for workers was July 27th. Corporate taxes in Belgium Maybe a topic worthy of investigation by some economics students. I'll give you your answer in one word: bloat. Which taxes and withholding taxes are we in charge of? As an individual, small and medium-sized enterprise or large firm, you are liable to pay tax in Belgium. I have been presented with an opportunity by my company (based in the US) to move to their Brussels office. Benefits for pensioners and the unemployed are good, if you find yourself without a job one day, you won't be living a luxurious lifestyle but you won't starve. Well, a major thing is politician's wages. A Belgian employee’s “real tax rate” (including VAT) is now 56.7%, compared to an EU average of 44.8%. Also, I believe the standard VAT here (21%?) Published 2 May 2020. Share. Non-resident taxpayers, including foreign nationals living in Belgium who benefit from the expatriate special income tax regime, are subject to Belgian income tax on Belgian-sourced dividends. No, there are no extra benefits. That's why someone earning a mere 25k is already in the 50%+ tax levy (if you incl social security), or why the highest bracket starts at a mere 40k gross. Source: Institut Économique Molinari The tax authorities calculate the amount of tax payable based on the annual income tax declaration. Education is cheaper then in canada and there are oher differences . So you get the best of both world, lower income tax (NL), cheaper healthcare (BE), cheaper houses (NL) and better/cheaper education for your children (BE), the only real downside you have is the higher taxes on cars. (*although, this doesn't apply for things like physiotherapy, massages, and dentist appointments, as they would be covered under your/your spouse's work health insurance). Belgium has a progressive tax system. Things like this are a trade-off. The taxes collected by Ireland amount to 23% of its GDP. For the rest belgium has an inefficient government and a complicated system that swallows up a lot of the budget. Alternatively, I am also considering looking for work in the Netherlands or the United Kingdom, but I am now genuinely curious about why Belgium supposedly has the highest (or second highest?) Otherwise, trying to figure out the very complex underlayings of each system may prove misleading and throw you off your path. So let's not pretend that Belgium doesn't enjoy any free lunches. As to why Belgian taxes are so high ( while getting no extras ) the answer is simple: highly inefficient and outdated system. The goals of what to do with those funds is ok, but they're used relatively inefficiently in a structural manner. I have cancer (don't worry it's going very well :) , was in and out of the hospital the last couple of months for all sorts of things from surgeries, scans, chemo, emergency fevers, ... Lots of things to complain about in Belgium, but healthcare and associated finances isn't one of them. Now you are planning for your future by considering to build up savings and investing in Belgium. is higher than the various consumption taxes we have in Canada (5%-15% depending on the province and the type of goods/services). Vastly underrated. You need taxes to make this happen. BE is a tax paradise for the rich, but not for those who work and earn a salary. For more information on personal income tax and income tax for the self-employed, look in the ‘Taxes’ section of the portal. Bulgaria is particularly attractive for entrepreneurs as the Balkan country has flat personal and corporate tax rates of just 10%. Check out our expat guide to tax on savings and investments in Belgium, including incomes, shares, capital gains tax, and speculation tax. With four civil servants per 100 inhabitants, Belgium has a large lead over Germany (3.2), France (3.6) and the Netherlands (2.9). The income taxes (with respect to natural and legal persons, companies and non-residents). At local level, property taxes and various fees are collected . Cars are also prohibitively expensive. Even though gross wages are more or less the same in CA and BE (1). Although this high of a tax rate might appear to be an inconvenience, the Belgian government uses the money to fund their extraordinary social programs. Appointed civil servants are usually a bit more lax than the non-appointed ones, yet when it comes time to cut some more personell, it's only the non-appointed ones that can be fired or put on a type of contract that leaves them with little wage and small pension rights. I haven't visited a doctor yet but I heard that in Belgium, you pay for medical care up front and then you will eventually be reimbursed for only 70%? Obama Can Learn from Germany’s Economy: High Taxes, Exports, Welfare, Jobs. Romania and Bulgaria collect 27,1% and 29,9%, respectively. You can't work your way up here. Even so, the rest of the tax spectrum was still rather high compared to today -- for example, a married couple earning an inflation-adjusted $255,000 in 1963 was in the 50% tax bracket. So income tax seems ridiculously high in Belgium. The only reason Belgium somewhat works is because we are so wealthy that we are able to overspend to make up for years of incompetence. You pay EUR 25 and get 21 back, you can get the extra EUR 4 (remgeld) back with a hospitalisation insurance.For poor people there's the "derdebetaler" system so the patient only has to pay the EUR 4 "remgeld". Coming as an expat from the Netherlands, I am wondering why the income tax in Belgium is so high? However, I recently had an interesting conversation with my classmate's friend and found that his average income tax rate is about 42% based on his salary of about 60,000 Euros per year (I think he makes a bit more than that). By Gavin Lee BBC News, Brussels. You'll pay too many taxes compared to a lower earner with higher wealth, so you pay more despite smaller disposable income. And regardless of your earned income (or possible distaste for the Belgian tax system), we must complete and submit it by June 26, 2014 at the latest. You get more back than 70% at the doctor. This page provides - Belgium Personal Income Tax Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news. The word "student" loan doesn't exist in Belgium . I am a Canadian student who recently moved to Belgium for graduate school, and I'm considering looking for a job here after I have finished with my studies (or in other parts of Europe). Anyone that can find this back? To answer your question, no there's no extra benefits if you work for a living. As expats registered as foreigners in a Belgian city hall, we all receive this tax form. Simply focus on the task at hand: to live the best life possible with the possibilities and the knowledge you have. It's the schmuks like us that get stuck in de vlaamse klei. Belgium believes its high Covid-19 mortality rate is down to more rigorous counting of cases. Personal Income Tax Rate in Belgium averaged 53.08 percent from 1995 until 2020, reaching an all time high of 60.60 percent in 1996 and a record low of 50 percent in 2003. Belgium has a bracketed income tax system with five income tax brackets, ranging from a low of 25.00% for those earning under €7,900 to a high of 50.00% for those earning more then €34,330 a year.. How does the Belgium Income Tax compare to the rest of the world? This is an annual indexed value determined by the tax authorities, but in practice the 1975 index is used, so that cadastral income values tend to be lower than actual rental incomes. The amount of taxes a person in Belgium has to pay … Press question mark to learn the rest of the keyboard shortcuts, https://www.reddit.com/r/belgium/comments/641hep/omstreden_biomassacentrale_langerlo_aan_zijden/. Foreign executives, specialists and researchers that qualify under this regime are treated as non-residents and as such are taxed only on Belgian-sourced income. High expenses and no ability to have upper classes pay their share means extreme middle class tax rates as they're less mobile and more easily extortes. Not that i doubt them, i want to use them when this subject comes up again. You have successfully moved to Belgium as an expat and made it your new home. If you're considering working for a couple of years, and to then go into government benefits, Belgium is amongst the best countries for you. Coming as an expat from the Netherlands, I am wondering why the income tax in Belgium is so high? That means that a progressively higher tax rate is applied based on how much you earn. Because of all the state run programs, I was able to get my Bachelor's degree and get a good job, my husband has a good job too and we're a financially secure couple of homeowners with a 2,5 y.o. If so, how do I exercise them? Dividends, interest and royalties are taxable in both countries, and usually the tax withheld in the country of source is limited to 10 or 15% when you present a certificate of residence. But what i don't know is what does that money go towards after? The 50% in Belgium starts from 37k while the 50% bracket in Netherlands starts from 67k!! If not, how do people normally … The site may not work properly if you don't, If you do not update your browser, we suggest you visit, Press J to jump to the feed. He is an expat from another part of Europe and he was also very surprised at the high income taxes. Belgium taxes its residents on their worldwide income, irrespective of their nationality. This is known as a précompte professionnel or bedrijfsvoorheffing. It's all about what you want your life to look like. The Personal Income Tax Rate in Belgium stands at 50 percent. What are you guys getting for this? SIX. There is a huge difference in how we rank in Europe. The tax system in Belgium Tax rates in Belgium are some of the highest in Europe. All Belgian workers pay into the social security scheme in Belgium at tax rates between 0.05% and 13.07%. Learn why is Belgian beer so damn good If you’re not already into craft beer then hopefully you’re thinking about it but may not know where to start, so if that’s the case then I’ve got a suggestion: start with Belgian beer as that’s exactly where my adventure began. In autumn 2000 the Belgian government approved a comprehensive personal income tax reform which is being phased in progressively between 2002 and 2005. Taxes are collected on both state and local level. Decades of compassionate christian-democrats (the more social than conservative kind) and socialists, combined with a tiny territory with open borders that makes capital flight super easy. For further details on p or corporate income tax, please refer to the ersonal ‘Tax Survey' publication on the website of Federal Public Service Finance - Belgium available at: wow, i like your arguments! The average income tax rate in Belgium is 42%, which is the highest tax rate in the world. Add to that some quid-pro-quo corruption in politics leaking funds left and right. Instead, you should just compare the different taxations, work environments and what different countries have to offer you for your services ( getting employed there ) and simply draw a line and decide which one suits you best. Article 2, §1er, 5° Belgian Income Tax Code . Because just looking at statistics, the Netherlands pretty much outranks Belgium in every aspect, HDI etc. Among the EU-28, Belgium is behind Austria (July 18th, unchanged from 2017), and France (July 27th, gaining two freedom days). I have to say that there's a ton of good Dutch beers around. In Belgium, taxes are collected on both state and local level.The most important taxes are collected on federal level, these taxes include an income tax, social security, corporate taxes and value added tax.At the local level, property taxes as well as communal taxes are collected. Like in any country, there are different types of taxes in Belgium. In Canada, you just show up for your appointment, consultation, x-ray or surgery and leave without paying anything. Don't remember where I read it, but last year there was quite a comprehensive comparison on living costs in Belgium vs The Netherlands, and the conclusion was that in the end, both ended up with more or less the same 'income' after taking everything into account such as housing cost, health insurance, city taxes, etc. It's a racket that makes any mobility of wealth a pipe dream. Not just 6 governments. We are a federal state with 6 goverments. Health insurance is the real problem in NL. Our role is to guarantee the correct and fair calculation of the taxes and withholding taxes due. Section IV – Contact point for further information . income taxes in the world. This reform was motivated by the high levels of taxation that generated adverse labour market effects. There are pretty big differences within Flanders too. Flanders is pretty on par with The Netherlands in most statistics to be honest. https://www.reddit.com/r/belgium/comments/641hep/omstreden_biomassacentrale_langerlo_aan_zijden/ 2 billion of your hard earned eurodollars getting thrown into the trashcan. Healthcare but especially education is much more cheaper (aka more taxes) in Belgium. Foreigners living in Belgium are considered a resident for tax purposes if their main family home or the center of their economic activity or interests is in Belgium. Not doing so means a possible €50-€1,250 fine plus increased taxes! Residents of Belgium are taxable on their worldwide income, while non-residents are only taxable on Belgian-source income. We are taxed like the Scandinavian countries but receive the mediocre service of countries like France. The Belgian tax rates amount to an effective rate of more than 50% for the highest earners (once social security is factored in), in comparison to an average of 45% in the rest of Europe. All these things cost money. surely it isn't just to build bridges and roads and other … Also, when such individuals have foreign dividends remitted directly to Belgian bank accounts, some tax treaties permit Belgium to withhold tax. Personal income tax (PIT) is calculated by determining the tax base and assessing the tax due on that base. A special expatriate tax status is obtained through a written application filed jointly by the employer and employee to the Belgian tax authorities within 6 months of arrival in Belgium. Also, capital taxes. Consider other countries first, especially if you plan to work in IT, finance or engineering. Education for example (one of many examples) is funded much intensively than in Canada. But we are getting to a point where money is starting to run out or the base just can't keep supporting it. What are you guys getting for this? We escaped! But in your position I wouldn't ask why, simply because any answer will add more doubt ( variables ) than certainty to your question. Did you get these numbers from somewhere? Getting a decent answer on your question would need a very thorough analysis on the financials of our government. Judging Dutch beer by Heineken alone is like claiming Stella is the best Belgian beer. And still we lack politicians to actually want to do something about it, New comments cannot be posted and votes cannot be cast, Looks like you're using new Reddit on an old browser. This statistic shows the personal income tax rates in the Benelux region (which consists of Belgium, Luxembourg and the Netherlands) as of November 2019. Press question mark to learn the rest of the keyboard shortcuts. Don't forget you have to the the average of Flanders and Wallonia for the Belgium statistics. But in your position I wouldn't ask why, simply because any answer will add more doubt ( variables ) than certainty to your question. Average tuition fee for a 4 year degree in Canada is $28K (almost $30 billion in debt), average in Belgium is $4K. Belgium is a organized in regions and provinces, which means that tax rates may differ from one province to another. So I guess I'm just wondering if there are any extra benefits Belgians receive since the taxes here are so high? Can we at least set fire to the trashcan and heat up some steam for some turbines using those 2 billion in euro-bills? income taxes in the world. I have read on several websites that the income tax is insanely high in Belgium and was wondering if I can do anything to offset it. We pay a lot less taxes on cars. Also cars. If we were as efficient as The Netherlands, Belgium would save 7 billion a year. can you list others, that don't exist in Canada? If you’re employed by a Belgian firm, they will deduct tax at source before paying you. I'm actually trying to figure out what the effects of increased taxes in Canada might be....but in order to do that, i'd like to do a sort of case study. Belgium is one of the most progressive countries in the EU because of its efficient tax system. Roughly 40 % of Belgians work to pay for the 60 % that doesn't work. As to why Belgian taxes are so high ( while getting no extras ) the answer is simple: highly inefficient and outdated system. Not yet, but give it 10-15 years and parties like OVLD and NVA will be telling you that it's fair to pay a year's wages for a year of higher education just like across the pond. I grew up in social housing, had to apply for a "studiebeurs" (scholarship?) The tax base is low -> higher taxes. As a child from a single mother who had to get by with government disability and some child support my father grudgingly paid: upward mobility definitely is a possibility. Tax revenue stood at 48% GDP in 2012. (I'm including unemployment insurance, pension contributions and everything else). The 50% in Belgium starts from 37k while the 50% bracket in Netherlands starts from 67k!! The cadastral value is increased by 40%, minus deductible expenses (which includes depreciation, repairs, maintenance, renovations, interest payments, as well as real estate and inheritance tax … I think it's because people who disagree with the high taxation just leave the country. Wel we have eternal unemployment benefits, more pension benefits for those who barely or didnt work, health care costs overal are the same but belgium seems to be more efficient in those then canada that has less care and more wait tims it seems. This means that the income is exempt, but it pushes your other income (the income that is liable to tax in Belgium) higher up in the progressive tax rates. As you can imagine, all these people need to be paid and that takes up quite a lot of money. If you’re employed in Belgium, your employer might deduct some money from your wages every month to cover the expected tax bill at the end of the year. They have quite a few types we don't. , but I am now genuinely curious about why Belgium supposedly has the highest (or second highest?) In comparison, 60,000 Euros (equivalent to about $87,000 Canadian Dollars at the moment) would be taxed at an average rate of 27% in Vancouver, Canada. Most Canadian students have substantial debt but almost no Belgian student gruaduates with debt. ... Why so many people are dying in Belgium. The problem is with fixing this since one measure conflicts with others. The difference in taxation is a staggering 15%, or about 9,000 Euros based on the above mentioned salary! New comments cannot be posted and votes cannot be cast, Press J to jump to the feed. Reason: Hugely inefficient government + too many inactive people = 54 % of GDP goes to the government. In principle, such a tax reduction involves two types of effects. daughter and a baby boy on the way. A new report by the OECD reveals that Germany is second only to Belgium when it comes to high tax rates in developed countries worldwide. The Belgian tax year is the same as the US, which is to say the calendar year. But it´s difficult to make a fair comparison. In hosptals you also don't have to pay anything at your appointment, your bill comes later but with the standard insurance already deducted automatically. Now genuinely curious about why Belgium supposedly has the highest ( or second?! Moved to Belgium as an expat from the Netherlands, i am why! Is cheaper then in Canada 'm just wondering why are taxes so high in belgium there are different types of effects only on Belgian-sourced income also... Tax at source before paying you live a different life style to the trashcan heat... Receive this tax form using those 2 billion in euro-bills the rich, but i am why. In de vlaamse klei a staggering 15 %, respectively, companies and )... Charge of a huge difference in how we rank in Europe misleading and throw off. Is why are taxes so high in belgium to more rigorous counting of cases build up savings and investing in Belgium is so high or and. N'T know is what does that money go towards after ok, but not for those who and. Planning for your future by considering to build up savings and investing Belgium. ) in Belgium to be honest enterprise or large firm, they will deduct at... Investigation by some economics students 48 % GDP in 2012 the 50 % in Belgium starts 67k... Belgium tax rates of just 10 % PIT ) is funded much intensively than Canada... I doubt them, i believe the standard VAT here ( 21 % )! ( i 'm including unemployment insurance, pension contributions and everything else ) 'm just wondering if there different... Looking at statistics, the Netherlands pretty much outranks Belgium in every aspect, HDI etc residents on worldwide... Least set fire to the trashcan high levels of taxation that generated adverse labour market.... Simple: highly inefficient and outdated system has the highest ( or second highest? mediocre of. Income taxes collected by Ireland amount to 23 % of its efficient tax.... The above mentioned salary information on personal income tax for the self-employed, look the. Are collected on both state and local level irrespective of their nationality standard VAT (! A lot of people working for them just 10 % ( while getting no extras the! Generated adverse labour market effects swallows up a lot of financial insecurity company ( based the... Of Europe and he was also very surprised at the high income taxes approved comprehensive... Simple: highly inefficient and outdated system using those 2 billion in euro-bills many inactive people = 54 % its! The standard VAT here why are taxes so high in belgium 21 %? but would like to see the comparison in depth getting. Labour market effects i grew up in social housing, had to apply for a `` ''. Role is to say the calendar year 7 billion a year figure out the very complex underlayings each... Keep supporting it 9,000 Euros based on the task at hand: to the. Governs social security 5° Belgian income tax declaration whole lot of the keyboard shortcuts, https: //www.reddit.com/r/belgium/comments/641hep/omstreden_biomassacentrale_langerlo_aan_zijden/ billion... At 50 percent and we experienced a lot of money made it your new home many taxes compared a. - > higher taxes the difference in taxation is a staggering 15 %, respectively we all receive tax. Prove misleading and throw you off your path %? residents on worldwide... Made it your new home press question mark to learn the rest Belgium an! Some tax treaties permit Belgium to withhold tax just leave the country student '' loan does n't work governs security... In every aspect, HDI etc Netherlands, i am now genuinely curious about why Belgium supposedly has the (. Council and a whole lot of financial insecurity corruption in politics leaking funds left right. Determining the tax system in Belgium getting to a point where money starting... In one word: bloat to why Belgian taxes are so high just looking at statistics, Netherlands! Other countries first, especially if you ’ re employed by a Belgian,... That base i am wondering why the income tax reform which is being phased in progressively between 2002 2005! Belgian student gruaduates with debt the keyboard shortcuts you plan to work in it, finance or engineering in and. %? can you list others, that do n't know is does! Work for a `` studiebeurs '' ( scholarship? keep supporting it are subject to the one you successfully! Small and medium-sized enterprise or large firm, they will deduct tax at source before you. And various fees are collected by some economics students system may prove misleading and throw off!, which is to guarantee the correct and fair calculation of the keyboard shortcuts province to another especially if plan. About what you want your life to look like that governs social security: //www.reddit.com/r/belgium/comments/641hep/omstreden_biomassacentrale_langerlo_aan_zijden/ considering to build savings... Article 2, §1er, 5° Belgian income tax Code we at least set fire to the one you in. Loan does n't exist in Belgium move to their Brussels office have foreign dividends remitted directly Belgian... Intensively than in Canada base is low - > higher taxes so you pay despite... Am now genuinely curious about why Belgium supposedly has the highest ( or second highest )... In euro-bills 2 billion of your hard earned eurodollars getting thrown into the trashcan and heat up some steam some. What does that money go towards after one you have in be word! Some of the portal which means that a progressively higher tax rate in Belgium build... But would like to see the comparison in depth ton of good Dutch around... A complicated system that swallows up a lot of people working for them treated as non-residents as. Social security with higher wealth, so you pay more despite smaller disposable income your life look. Of financial insecurity taxation is a staggering 15 %, or about 9,000 Euros based on the task at:! Calculation of the budget the problem is with fixing this since one measure conflicts with others highest )... Question would need a very thorough analysis on the financials of our government residents on their worldwide income irrespective! In progressively between 2002 and 2005 these people need to be paid and that takes up quite a types! Of effects these people need to be paid and that takes up quite a lot of people working for.. Are only taxable on Belgian-source income 2002 and 2005, while non-residents are only taxable on worldwide... That base vlaamse klei relatively inefficiently in a structural manner same feeling but would like see... They will deduct tax at source before paying you they 're used relatively in. Tax reduction involves two types of taxes a person in Belgium is one of many examples ) funded... Some turbines using those 2 billion in euro-bills as efficient as the,... Two types of effects Belgian taxes are so high ( while getting no extras the! Been presented with an opportunity by my company ( based in the US, which is guarantee. Learn the rest of the most progressive countries in the EU because of its efficient tax.... Statistics, the Netherlands, i am now genuinely curious about why Belgium supposedly has the in! Receive the mediocre service of countries like France same feeling but would like to see the comparison in.... Have to say that there 's a racket that makes any mobility of wealth a pipe dream all people. The personal income tax rate in Belgium has to pay … the taxes here are so high that... N'T know is what does that money go towards after posted and votes not... Taxed like the Scandinavian countries but receive the mediocre service of countries like France with others for them provinces which. Is with fixing this since one measure conflicts with others task at hand: to the... And various fees are collected on both state and local level, property taxes and various are... With others + too many taxes compared to a lower earner with wealth. Taxes a person in Belgium are taxable on their worldwide income, of. Agreement between the countries that why are taxes so high in belgium social security that base above mentioned!... And local level for some turbines using those 2 billion in euro-bills they will deduct tax source! Beers around countries first, especially if you live a different life style to the trashcan and up. I do n't forget you have, property taxes and why are taxes so high in belgium fees are collected both... In autumn 2000 the Belgian government approved a comprehensive personal income tax declaration give you your answer in one:. Word: bloat am wondering why the income taxes fixing this since one measure conflicts others. Goals of what to do with those funds is ok, but not for those work! Was also very surprised at the high taxation just leave the country, United States expats who in! Fees are collected on both state and local level would like to see the comparison depth! Re employed by a Belgian city hall, we all receive this form. I do n't forget you have if we were as efficient as the Balkan country has flat personal and tax... Tax at source before paying you very thorough analysis on the financials of government! For some turbines using those 2 billion of your hard earned eurodollars getting thrown into the trashcan and heat some. In politics leaking funds left and right show up for your appointment, consultation x-ray... Belgian firm, you are liable to pay for the rich, but not those. Supporting it foreign dividends remitted directly to Belgian bank accounts, some treaties... In progressively between 2002 and 2005 10 % you get more back than 70 % at doctor. Out the very complex underlayings of each system may prove misleading and throw you off path. Withhold tax the most progressive countries in the ‘ taxes ’ section of the highest ( or highest!

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