Belgium needs more tax reform, says European Commission

Belgium needs to go further in its tax reforms, according to a report released yesterday by the European Commission. The country is placed in a group of nine European Union member states which appear to have a need to reduce relatively high tax burdens on labour and the scope to increase less distortive taxes.

"These member states could, therefore, consider shifting the tax burden away from labour," the report recommends. This would help create jobs and stimulate the economy.

Taxes which would create less distortion in the economy include consumption taxes such as VAT, environmental taxes and recurrent property taxes. In this last category Belgium is taken to task as the only country in the EU still applying property transaction taxes above 10%, with the recommendation that recurrent property taxes should take more of the strain.

Analysing the report, financial paper L'Echo concludes that the €7.2 billion 'tax shift' included in the 2016 budget goes in the right direction, while suggesting that it may not be enough to satisfy the Commission.