Tax breaks for economic disaster zones

  • The government will look closely at new economic recovery measures this November.
  • A “free zone” is among the possible new measures being considered.
  • We were able to examine the details of this project.

Summary: A region with over 50,000 inhabitants suffering a loss of over 1,000 jobs could be entitled to a favored tax status. Based on this criteria, regions such as Liège or Limburg could be eligible.

Companies wanting to invest in these regions could receive tax advantages. For each new job, they could receive a 35% to 40% exemption on payroll taxes. Other policies could be added to these. “It’s entirely possible that the regions could decide to add employment subsidies or other incentives to this tax system,” states a federal source. “It’s up to the regions to make these decisions. We are only authorized to deal with tax policy”. Even better: on the national level, the system managed is structured to work hand in glove with European subsidies. The zones in question could then enjoy federal and regional tax incentives along with European subsidies. The text is now on the federal government’s table. Its sponsors Finance minister Koen Geens’ (CD&V) department have already tested the model with the European Commission’s Competition Directorate. There are no objections to delineating zones or to the tax incentives. If the regions would like to add further support, they will have to confirm their compliance with European law, but “this should not be a problem” continues our source. In addition, some in the federal government would like the same advantages offered to regions with very high unemployment rates. The new criteria will also have to undergo verification of compliance with European law. Here again, the parties are optimistic about the legality of the criteria. 

CONTINUED IN THE FOLLOWING ARTICLE

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One Response to Tax breaks for economic disaster zones

  1. Paul says:

    Let’s all move our companies there! (no doubt, workers will drive on over to get those jobs). My 2 cents? Subsidies falsify markets and don’t work anyway.

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