Belgium’s high rate of taxation has been making headlines for years, and experts suggest that this is unlikely to change going forward despite the regular amendments to tax laws.
Every year, the tax burden changes slightly. These variations can be explained, among other things, by the adoption of new laws that impact the tax rate or by the emergence of crises.
"During the health crisis, for example, wages fell," tax lawyer Typhanie Afschrift told RTBF. "When shops and hospitality establishments were closed during the weeks of lockdown, the Belgian State no longer received VAT. All this has led to a slight decrease in tax revenue and therefore a slight decrease in the tax burden."
What also impacts the tax burden is the profits of large companies, she added. "The more a company earns, the higher the tax burden without having to change the tax rate."
Competition of the highest taxes
"Belgium's position generally varies between second and fourth place on the scale of the highest absolute taxation," Afschrift noted. This means that Belgians are among the citizens who pay the most taxes and social contributions to the State.
According to Afschrift and economist Bertrand Candelon, the competitors for the gold medal for highest taxes are generally Denmark in first position, France in second place and Belgium in third position – a statement that has been confirmed by the latest figures from the Molinari Economic Institute.
According to the results of the study "The Tax Burden on Global Workers," Belgium won the bronze medal in 2021 with a tax and social pressure equal to 53.95%. Only France and Austria surpassed Belgium with a tie of just over 54.6%.
More tax for being alone
According to OECD figures, single Belgians without children paid an average wage saw nearly 52.6% of their salary go towards taxes in 2021. Elsewhere in Europe, this same profile is taxed at 41.3%.
On the other hand, a married couple paid an average salary and parents of two children were taxed at 45.2% in 2021. A difference that is explained by the number of dependents.
"Belgium is the European country that taxes the most isolated people," said Afschrift. "And if we only take into account the taxation on labour income and not all taxation (income from work, real estate income, income from capital etc.), then Belgium is even more often in first and second place among the European countries that tax the most."
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And if Belgium taxes so much, it is mainly to pay for social protection, health care, education, pensions and more generally, to keep the country running.
But is this taxation justified? Does the State cost too much in relation to the services it provides? These are the questions asked by Candelon and Afschrift. "The Dutch and Germans are less taxed and have less deficit than us," Candelon said. "In Belgium, the debt is increasing despite taxation. I think taxation in Belgium is too high, and public spending is no longer effective."
