Expat Regime
The new government aims to attract and retain international talent to boost Belgium’s economic competitiveness. To achieve this, the existing expat regime will be made more attractive. This favourable tax scheme provides benefits to foreign employees and company executives working in Belgium.
The regime will be modified in three key areas:
The tax-free allowance will increase from 30% to 35% of the total annual gross salary.
The annual cap of €90,000 on the tax-free allowance will be abolished, allowing recurring expenses to be reimbursed tax-free by the employer.
The minimum gross salary required to qualify for the scheme will be reduced from €75,000 to €70,000.
Cross-Border Employment
The government intends to reduce the administrative tax burden for cross-border workers.
At the same time, controls will be tightened. Abuse of secondment arrangements will be addressed, and the government will examine whether tax monitoring of the 183-day rule can be improved by using existing data from the National Social Security Office (NSSO).
Additionally, Belgium plans to introduce cross-border recovery of social security contributions via a European mechanism.
Investigation and Assessment Periods
The previous government extended the investigation and assessment periods for tax returns with international components (e.g. those with transfer pricing obligations) from 3 to 6 years. This will now be reduced to 4 years, starting from January 1 of the relevant tax year, except in cases of fraud.
Digital Tax
Current tax rules do not fully reflect the realities of the digital economy. Companies are generally taxed in the countries where they have a physical presence, not where their users are located.
To address this, Belgium supports OECD/G20 and EU initiatives for fairer taxation. If no European or international agreement is reached by 2027, Belgium will introduce its own national digital tax.
Under the previous government, a national digital tax was postponed due to progress in global negotiations. However, since the United States withdrew from the OECD agreement, a global consensus now appears unlikely.
New Double Tax Treaties and Automatic Exchange of Information
Belgium plans to expand and accelerate the ratification of its network of double tax treaties. Additional agreements for the automatic exchange of financial information will be concluded, with particular focus on emerging economies.
Social Security Contribution Cap
The government also plans to introduce a cap on the taxable base for social security contributions, setting a maximum limit of €250,000. This measure is intended to support high-skilled employment and improve Belgium’s international competitiveness.
