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Tax shift can result in up to 64,500 new jobs
The tax shift of this federal government with the N-VA will have a noticeably positive impact on economic growth, job creation and citizen’s income. That’s what new studies by the Federal Planning Bureau (FPB) and the National Bank of Belgium (NBB) show. “These studies also show for the first time that the tax shift will even help reconstruct the budget thanks to substantial job creation. This means more income is generated for the government, and it doesn’t have to spend as much,” said Minister of Finance Johan Van Overtveldt.
The tax shift makes labour significantly cheaper, with direct positive impact on job creation. Another positive effect is that the real disposable income of private persons will also increase by more than two percent, boosting consumption. This in turn improves employment, which would increase by 1.7 percent, good for 64,500 extra jobs.
Economic growth can be up to one and a half percent higher in 2021 compared to a situation with no tax shift, the new studies point out. The Planning Bureau adds that the profit margin of businesses will also increase by 0.6 percent. Due to various kinds of payback effects, the tax shift will also help put the budget and government finances in order. “The regions will of course benefit from those effects too,” confirms Johan Van Overtveldt.
Putting accounts in order
Finally, the Minister of Finance points out that the tax shift is already fully financed until 2018. The insinuation that the Court of Audit had found a gap in the tax shift were formally denied by the same institution. “Increase of net wages is also safeguarded,” Johan Van Overtveldt concludes. “More than half of people would have 100 euros net a month extra, and this amount can increase to as much as 140 euros.”