Prime Minister Alexander De Croo (Open VLD) and Finance Minister Vincent Van Peteghem (CD&V) will meet on Sunday as they attempt to break the Federal Government deadlock over tax reform.
Despite the fact that negotiations have been ongoing for several weeks, the positions of the parties in the Vivaldi coalition – which includes liberals, socialists, Christian democrats, and environmental groups – are still very far apart.
All parties agree that the main goal of the reform is to reward work, whilst at the same time reducing Belgium's soaring budget deficit and preserving the competitiveness of businesses.
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However, the coalition members have markedly different views on how to achieve this objective. The liberals would prefer to reduce public spending and implement strict labour reforms, such as a time limit on unemployment benefits. The socialists and the green parties, meanwhile, want to raise taxes on wealthier Belgians.
Another point of contention is the impact of the tax reform on regional finances. Both the Walloon and the Flemish Governments have already made it clear that they do not intend to pay for the federal reform.
