On 29 July 2025, the Programme Act of 18 July 2025 was published in the Belgian Official Gazette. The act comprises an initial package of measures that form part of the tax reform announced in the De Wever Government’s coalition agreement. However, numerous other tax measures are in the pipeline, spread over various legislative initiatives for which the law-making process is still ongoing.
Here, we provide a brief summary of the measures contained in the Programme Act and those still in preparation.
Programme Act of 18 July 2025
Current status: published in the Belgian Official Gazette on 29 July 2025.
Carried interest obtained by a carried interest beneficiary of a Belgian or foreign carried interest vehicle will become taxable as movable income at a rate of 25% under the personal income tax rules. The act defines what is meant by carried interest and carried interest vehicles. The measure entered into force on the date of its publication in the Belgian Official Gazette.
Shareholders of companies that emigrate or transfer assets abroad as part of a restructuring will be subject to a new exit tax. They will be taxed on a (fictional) dividend under the personal income tax rules. The exit tax can be paid in instalments and measures have also been introduced to prevent double taxation in the event of actual distribution. The measure came into force on the date of its publication in the Belgian Official Gazette and applies to transactions from that date.
The liquidation reserve and VVPRbisregimes are harmonised. The waiting period for the liquidation reserve is lowered from five to three years, and the rate on subsequent distributions goes up from 5% to 6.5% (bringing the total tax charge to 15%, as with the VVPRbis regime). Liquidation reserves created before 1 January 2026 may be distributed at the 6.5% rate if they have been held for a period of three to five years. For the VVPRbis regime, the 20% rate will be phased out gradually. The changes relating to the liquidation reserve came into force on the date of their publication in the Belgian Official Gazette. The changes relating to the VVPRbis regime came into force ten days after their publication in the Belgian Official Gazette.
The participation (holding) requirement for the participation exemption (dividends-received deduction, or DRD) is being tightened. For shareholders (those who do not qualify as a small company) with a holding of less than 10% but whose acquisition value amounted to 2.5 million euros or more, participation will now also have to be of a "financial fixed asset" nature in order to meet the relevant requirement. This measure will take effect from the 2026 assessment year. For companies that keep their accounts on a calendar-year basis, it will therefore apply from 1 January 2025.
Foreign companies with a holding of less than 10% of a Belgian company but whose acquisition value was 2.5 million euros or more may, under certain conditions, benefit from an exemption from the withholding tax on dividends. That exemption now also requires the participation to be of a "financial fixed asset" nature, if the foreign company shareholder is not a small company.
The 10% tax increase for a first breach of tax rules committed in good faith is abolished. This applies to assessments enrolled on and after the date of the measure’s publication in the Belgian Official Gazette. On 28 July 2025, the authorities published circular 2025/C/49 commenting on this change.
A standing system of tax and social security regularisation has been introduced. The measure came into force ten days after being published in the Belgian Official Gazette.
After 1 January 2024, sales of new-build homes in the context of demolition and reconstruction no longer attracted the reduced 6% VAT rate. Now, the final transitional measures for that scheme ended on 30 June 2025. The 21%VAT rate on homes supplied on a “demolition and reconstruction” basis will go, and such supplies will in future permanently attract VAT at just the 6% rate, provided that all the relevant criteria are met (including, for example, the maximum surface area of 175 sq. m.). This measure came into force on 29 July 2025, the date of its publication in the Belgian Official Gazette. However, an administrative tolerance had already been in place previously, allowing for the 6% VAT rate to apply as of 1 July 2025.
Two rebuttable presumptions are being introduced to counter abuse in respect of the tax on securities accounts. The presumptions target: (i) the conversion of financial instruments on a securities account into financial instruments that are not registered on such an account; and (ii) the partial transfers of securities to other securities accounts held in the name of the same account holder. These measures came into force on the day of their publication in the Belgian Official Gazette.
Finally, the Programme Act covers miscellaneous other matters: it extends certain tax concessions on overtime payments; it ups to 1,000 euros the registration fee in the context of applying for Belgian nationality; there is a change to embarkation tax (airport fee); and the reduced VAT rate of 6% for the supply and installation of fossil-fuel-fired central heating systems is abolished.
Miscellaneous Provisions Bill
Status: pending before Parliament.
Various changes will be made to the investment deduction. For example, the limitation on allowances that can be claimed for transferred investment deductions is set to be repealed. The prohibition against combining them with regional state aids will also go. Furthermore, the rates of 30%, for large companies, and 40%, for small companies, will be harmonised at 40%. A few clarifications will be made with regard to the previous changes to the investment deduction.
Following European case law, it is proposed that the current-year DRD should also be applicable to the group contribution that is received.
The Government wants to introduce a separate 5% tax on certain capital gains realised on shares in qualifying investment companies, such as DRD sicavs (open-ended funds), sicafs (closed-ended funds), specialist real estate investment funds (FIIS), regulated real estate investment companies (BE-REITs) and ELTIFs, to the extent that they are exempt under the standard corporate income tax rules for exempting capital gains on shares (article 192 BITC92). In addition, the deductibility of withholding tax on dividends distributed by qualifying investment companies will also be made conditional on the minimum remuneration of company directors being paid.
The assessment and investigation periods for income taxes were significantly extended from assessment year 2023, which year also saw the period for challenging VAT fraud upped from seven to ten years. The Government now wants (partly) to reverse these changes. For example, the time limits in cases of fraud will be reduced from ten to seven years for income taxes and VAT, and the time limits for semi-complex and complex income tax returns will be reduced to four years (instead of six or ten) – you can find out more about this in our previous contribution.
Various changes are also proposed to personal income tax, particularly with regard to property taxation (abolition of various federal benefits relating to properties that the taxpayer owns beyond their principal residence), the expatriate regime, flexi-jobs (raising the annual cap on pay exempt from taxation), car taxation (a new tax allowance regime for hybrid vehicles), maintenance allowances (including a gradual reduction in deductibility and taxability down to 50%), the means of subsistence for dependants (the maximum amount is raised), the tax credit for own resources for self-employed persons, and, finally, abolition of a number of fiscal benefits will make it easier to fill in your tax return).
The Government wants to "freeze" the indexation of several tax expenditures at the indexed amounts applicable for the 2025 assessment year until the 2030 assessment year. This includes the exempt first tranche of income from savings deposits and dividends, the tax basket for the tax reduction for federal long-term savings, and the tax reduction for the acquisition of employer shares and for pension savings.
Bill introducing a tax on capital gains on financial assets
Current status: approved after first reading in the Council of Ministers on 18 July 2025.
The long-awaited capital gains tax on financial assets finally seems to be taking shape. After its first reading, the bill broadly comprises the following:
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Capital gains tax will be broad in scope, including crypto assets. The rules apply to the personal income tax, but will also apply to legal entities tax, although an exception is provided for certain entities.
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The capital gains tax rate is set at 10%. Capital losses realised in the same year are deductible and there is an annual exemption of 10,000 euros (subject to indexation). Subject to certain requirements, an exemption of 15,000 euros may be claimed.
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Special rules will apply to taxpayers who hold a "significant interest", which means that they hold 20% or more of the rights in the company whose shares are being transferred. An annual exemption is foreseen for the first 1 million euros of capital gains per five years, and, above that, the rates range from 1.25% to 10%.
Bill reforming the rules on personal income tax
Status: approved after first reading in the Council of Ministers on 18 July 2025.
This bill brings together a number of measures from the coalition agreement that form part of the Government’s aim to make work more rewarding. It also contains a number of provisions to simplify certain arrangements and remove uncertainty. These include an increase in the tax-free allowance, tax reductions for pensions and replacement income, adjustments to the marriage quotient (married person’s allowance), the principle of imposing tax on the living wage, overtime, young athletes’ pay, a 33% levy on working pensioners, a de minimis rule for article 90, first paragraph, 1° BITC92 (e.g. income from sales on second-hand platforms), the introduction of an entrepreneur's allowance, repeal of the rule augmenting tax liability where self-employed sole traders make insufficient advance payments of tax, royalties, reduction of the special social security contribution, adjustment of the work bonus, the remuneration of employees and company directors (no more than 20% of gross salary may consist of benefits in kind) and increase and indexation of the minimum remuneration for company directors).
Bill containing various tax provisions
Status: approved after first reading in the Council of Ministers on 18 July 2025
This bill contains only a number of technical amendments and a provision confirming certain Royal Decrees on direct taxation.
