Come the end of September, days and nights are of equal length for the second time in the year. It’s the equinox. Then darkness sets in earlier and earlier each day. This darkness provides insight into the economy. It tells you which companies are still working late at night: the lights are still on for bookkeepers, accountants and tax consultants who are filing tax returns. Even at weekends, their lights are still burning during that period, although this is less noticeable.
The withholding tax system keeps the country on course. As long as the proceeds from this tax increase, the Minister of Finance will not lose sleep over the state of affairs at the Federal Public Service Finance.” The comment of a trade union leader about the tax authorities. Withholding tax is the beating heart of our treasury. Every month, it provides the necessary liquidity, straight from the pockets of Belgium’s wage earners. Law philosophers who venture into taxation praise payroll tax – and withholding taxes in general – as an efficient way to collect tax, and rightly so.
A panic-stricken aide bursts in, interrupting a government meeting. Gasping for breath, he stammers that a wind of discontent is blowing among the people. There is unrest and, in his opinion, it would not be unwise for their excellencies the ministers to show some token of appreciation for the people. People are suffering under the yoke of the coronavirus pandemic and the limitations and sacrifices that come with it.
This year’s Chief Technology Officer of the Year award does not go to a person, but to the legion of coronaviruses. Acting as a stress test for digitization, Covid-19 has digitally catapulted a number of businesses and organisations a few light years into the future. Yet, the urge for digitization is by no means new: it has been around for almost two decades.
In a national recruitment campaign to attract new e-audit professionals, the Belgian Federal Public Service Finance noted the following: “Tax fraud is perhaps the crime in which the most creative systems are devised and used. E-auditors have a keen eye for spotting secrets and exposing the fraud hiding between bits and bytes. They are professional, creative and flexible in their job, without neglecting their private life.” These are the special forces under the Revenue’s command: e-audits.
Tax law is a matter of public policy. This is a legal doctrine which means, among other things, that tax law must be applied at all times, that it cannot be deviated from, not even by the court. The competence of everyone and everything related to it is limited to its rigorous implementation. After all, paying taxes is the cornerstone of our society.
Tax law is a matter of public policy. This is a legal doctrine which means, among other things, that tax law must be applied at all times, that it cannot be deviated from, not even by the court. The competence of everyone and everything related to it is limited to its rigorous implementation. After all, paying taxes is the cornerstone of our society.
Anti-money laundering regulations have gone too far
There was an avalanche of Belgian top tax experts’ comments on Twitter a few weeks ago, following the Supreme Court ruling of 13 October 2020. The stumbling block was the burden of proof in money laundering cases.
Governments would like us taxpayers to believe that there is only one battle, and that would be the fight against tax fraud. There is at least one other battle, but the authorities would rather not tell us about it. It is an internal struggle that they prefer to keep under wraps.
Studies predicted it, and it is now becoming a reality: the economic crisis caused by the COVID-19 pandemic has become a liquidity crisis. For companies trying to shift up a gear, this is a nightmare. While their invoice payments are delayed if paid at all, they nonetheless need to meet their own financial obligations in good time.
Transposition of the 5th Anti-Money Laundering Directive: preliminary draft law
The transposition of the 5th EU anti-money laundering directive (AML) into Belgian law is currently the subject of a preliminary draft law containing various provisions to prevent money laundering and terrorist financing (Anti-Money Laundering/Combating the Financing of Terrorism - AML/CTF) and to restrict the use of cash.
A Dutch entrepreneur got into trouble with his company during the previous credit crisis. He came up with a creative solution: he asked his insurer for his accrued pension capital and temporarily transferred it to the company, with the intention of replenishing that capital as soon as his equity had recovered.
THESE ARE STRANGE CIRCUMSTANCES. New insights and concepts that were simmering below the surface are emerging, even in taxation. In this respect, this manifests itself in a particular form of paternalism, and this time not only in Belgium.
OVER THE PAST FEW WEEKS, we’ve all been on lockdown. We’ve been working from home and travelling was totally out of the question. In this context, we’ve had to make do with what we had, trying our best. For some jobs, teleworking is not an option at all, for others more so. Working from home and remotely has replaced working in a workplace.
Agreements and clarity are crucial, also with regard to taxation affecting cross-border employees
The coronavirus crisis is presenting us with unprecedented challenges. International taxation is no exception. In Belgium, a blanket entry and exit ban on non-essential travel has been in effect since 18 March 2020. In addition, teleworking is mandatory for all employees whose function allows it.
THIS IS ONE OF THE fundamental principles of our society: everyone is equal before the law. As such, it is the pillar of our democratic system. It constitutes the basis of Articles 10 and 11 of the principle of equality enshrined in the Constitution.
Accounting errors at Belgium Ltd are no small matter
‘It’s not that simple, you say? That could very well be true, but we are not blind. We can see what kind of cars your top people drive. We can see the luxury enshrined within your offices.’ Jan Tuerlinckx, partner at Tuerlinckx Tax Lawyers, addresses the State of Belgium in a letter.
IT MADE THE NEWS the other day: the Belgian government is only an average performer where it comes to digitisation. And we may even consider ourselves fortunate in having Tax-on-web to boost our reputation.
DATA IS FOR the economy what oil used to be. It also becomes more and more important for the fiscal control. New IT applications are supposed to help optimise that control.
IN BELGIUM AND ABROAD, banks find themselves increasingly in trouble because they accept money that may not have been taxed fully in the past. It recently happened to KBC in the Netherlands, and to Degroof-Petercam before that. Sooner or later, however, all banks will probably face the same music.
THE BELGIAN COMPANY CODE (Wetboek van Vennootschappen en Verenigingen - WVV) came into effect last month. The possibility to contribute to a company’s capital with one’s work is one of the Code’s signature reforms. Or to put it in the terminology of the old code: it is now possible to contribute to the capital of the company by working for that company.
FISCALITY INFLUENCES our behaviour. People avoid highly taxed transactions or income, preferring tax exemption and low tax solutions. The government has planned for that.
