Belgium's State Secretary for the Budget Alexia Bertrand (Open VLD) proposed to reduce the "tax burden" and widen the financial difference between employed and unemployed people in Belgium. Her hope is to make employment more attractive than living off of social benefits.
Bertrand told Le Soir during an interview that she had recently sat in a conference of the Public Centre for Social Welfare (OCMW) with 50 social workers whose jobs are to help people find work. At the conference, the unanimous claim was that working full-time does allow for "systematic emancipation from the OCMW".
According to Bertrand, the situation calls for a reduction of the tax burden, thereby increasing the differential between work and non-work. The minister stated that while the government has worked for those in the lowest salary bracket, work needs to be done for the lower middle salaries – those earning between €2,500 and €3,550 gross.
Reform should not benefit the unemployed
The minister stated that, given that the reform must be finalised before summer, every side needs to compromise somewhat – as the different sides have been deadlocked over the reform for months. However, when asked by Le Soir about her party's position, Bertrand stated that their veto is that "people who are not working should not benefit from the reform".
There is no longer a sufficient gap between those living on social benefits and those who work, according to Bertrand. "People who receive the social rate, reduced rates in crèches, increased social allowances, transport allowances, and so on, go from 'on' to 'off' when they go back to work – losing all of these benefits." Some social workers allegedly even advise people not to work.
"We, therefore, propose that there should always be a difference of €500 net between those who work and those who do not" Bertrand stated. "And that we look at these benefits not according to a status, but according to income and real needs." For example, allowing a person in need to keep their transport or energy allowance when they work, which will be especially important for single-parent homes according to the minister.
"We have to make sure that work is once again emancipating and that the quality of life and standard of living increases when you go to work," Bertrand continued, confirming that the €500 differential is her main priority for the tax reform.
As to the financing of the tax reform, Bertrand explained that the project of Minister of Finance Vincent Van Peteghem is partially financed by consumption. The Open VLD finds the shift from labour tax to consumption and "pollution" tax more acceptable than finding other ways to tax those who work. Another part will be financed by the Regions themselves and finally, some of the measures for the reform were applied in the Federal Budget.
When asked about Van Peteghem's idea to tax the rich on their assets, Bertrand stated that the Open VLD is not dogmatic and that the party has no taboos. The State Secretary agreed that there are lines that the Liberal party do not cross and that adding taxes is "complicated".
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"If it's to shift taxes, we can look at it; but if it's to add taxes, it will be really complicated for us," Bertrand stated. "We must not allow people to leave the country and lose revenue."
"According to studies, each jobseeker who is put back to work is worth €28,000 to the state," the Budget Secretary of State stated. "If we managed to get 500,000 people back to work, we'd be looking at €14 billion. That makes a difference!"
Bertrand concluded that the ultimate goal "is to make social security sustainable" and that everyone should contribute to the system so that "life's accidents can still be taken care of".
