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Belgium: Constitutional Court annuls annual tax on securities accounts

Belgium: Court annuls annual tax on securities accounts

The Belgian Constitutional Court issued a decision annulling the annual tax on securities accounts, with effect as of 1 October 2019.


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The decision implies that the tax can no longer be levied for future periods. However, taking into account the potential budgetary and administrative implications, the Constitutional Court also decided that for the tax periods that have elapsed by 30 September 2019, the tax remains due.

The case identifying information is: case n° 138/2019 (17 October 2019)

Annual tax on securities accounts

An annual tax has been levied on securities accounts held by natural persons, effective 10 March 2018. The tax aims at deriving higher tax revenues from capital and assets and at providing a more equitable fiscal policy.

  • The tax is imposed at a rate of 0.15% but only if the average value of certain taxable financial instruments in the securities account(s) is at least €500,000 per account holder.
  • The first tax period started on 10 March 2018 and ended (at the latest on) 30 September 2018, for which the tax had to be paid by 30 August 2019. The second tax period runs from 1 October 2018 through 30 September 2019.
  • Derivatives, such as options, futures and swaps, are not taxable. Also “structured products” that do not provide a “100% capital guarantee” such as real estate certificates, sprinter’s/turbo’s/speeders, and financial warrants are out of scope for the tax.
  • Registered shares (nominative shares) that are not held in a securities account but only via a shareholders register, do not qualify as a taxable instrument and, therefore, do not count when it comes to determining whether the €500,000 threshold is reached.

Decision of Belgian Constitutional Court

Soon after its introduction, several claims were filed with the Belgian Constitutional Court against the new annual tax on securities accounts. According to the claimants, the tax was contrary to the Belgian constitutional principle of equality and non-discrimination and the European fundamental freedom of capital and/or services as the scope of the tax is selective.

The Constitutional Court decided that several elements of the tax on securities accounts, related to the taxable items and taxable base (listed below), gave rise to unreasonable differences in the tax treatment between individuals:

  • Only taking into account certain financial instruments
  • Registered shares that are not held in a securities account escape from the tax
  • The share in the average value of the securities account is deemed to be proportional to the number of holders of the securities account, but this does not always correspond with reality because some holders could escape the tax

Accordingly, the Constitutional Court held that provisions of the law regarding the tax on securities accounts needed to be annulled. 

KPMG observation

With this decision, the law introducing the tax has been annulled. However, the decision also reflects that the law is maintained for the tax due for tax periods ending on or before 30 September 2019. Hence, the annulment of the law applies for future tax periods (starting as from 1 October 2019). Consequently, in principle, financial intermediaries and/or natural persons cannot seek refunds of amounts of the tax that has already been paid, and they will have to declare and pay the tax in respect of a tax period that has ended on or before 30 September 2019.

Read an October 2019 report prepared by the KPMG member firm in Belgium 

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