Tax shift now visible on payslip

At the end of last year the Tax shift There is a tax shift when a new tax is implemented or an existing tax is increased in order to reduce or get rid of another tax. The N-VA is a proponent of a shift of the burden on labour to that on consumption or environmental pollution, for example, but not of a tax that increases the total burden of taxation. tax shift was voted on. This has brought about the biggest tax reform since 1963. "More Competitiveness The extent to which companies in one country can compete with similar companies in another country. A law came into force in Belgium in 1996 to monitor competitiveness. This stipulates that Belgian salaries may not evolve faster than the average of those in the three neighbouring countries. The Central Economic Council (CEC) performs an annual measurement to see if the objectives have been obtained. competitiveness and less taxation on labour, that is what this historic reform is about," Minister of Finance Johan Van Overtveldt explains. "And this decreased taxation on labour will materialise swiftly for many people. They will see the tax benefit on their payslip for January."

The Minister of Finance has decided not to wait for the recalculation of the tax assessment of spring 2017 to implement this part of the tax shift. The tax reduction is converted directly by means of a modification of the withholding tax. This means more than half of all workers will have more than 50 euros more net to spend, starting from this month. "And this is only the start of a tax reduction of more than 100 euros promised by the end of our legislature," Van Overtveldt mentions. The primary focus of that tax reduction is lower and middle incomes. People working for minimum income, will now have nearly 80 euros a month more to spend.

Pensioners also benefit
Pensioners will enjoy the lower tax rate of thirty percent starting from this month. Most pensioners who are taxed according to this rate, will have approximately 12 euros more to spend every month from now on. This measure is added to the efforts to increase the lowest pensions, more specifically through the so-called Prosperity envelope A “piggy bank” that serves to keep the lowest benefits, and especially pensions, and the replacement incomes inflation-proof. prosperity envelope , a ‘piggy bank’ that serves to keep the lowest allowances and replacement incomes Inflation The increase in the general price level. The original meaning (literally “to blow up”) is monetary inflation, which means that the amount of money increases. Today, inflation primarily refers to price inflation. This means an implicit monetary depreciation. This causes the purchasing power to drop. inflation -proof.