Last night, the Programme law was adopted by the country’s Parliament in plenary session. This Programme law introduces a wide range of fiscal, social, and economic measures, many of which will have an immediate and significant impact on businesses, employers, and individuals. Below is an overview of its key provisions.
Tax measures
Annual tax on securities accounts
The annual tax on securities accounts is doubled, going up from 0.15% to 0.30%. This change is applicable for reference periods that will end from the date of publication of the law in the Belgian Official Gazette.
Aircraft boarding tax
From 1 January 2027, this tax will increase from €5 to €10 for passengers travelling on flights exceeding 500 km. For passengers on flights of less than 500 km, the tax will increase from €10 to €10.5 on 1 January 2028, and then to €11 on 1 January 2029.
Annual tax on insurance operations
The rate of the annual tax on insurance operations is increased from 9.25% to 9.60%, applicable to premiums due as from the first day of the month following the month of publication of this law in the Belgian Official Gazette, and no earlier than 15 May 2026.
Annual tax on credit institutions
The tax base for the annual tax on credit institutions is adjusted to allow the deduction of certain debts. Moreover, the applicable rates are increased from 0.15205% and 0.20204% to 0.19286% and 0.25626% respectively, applicable from assessment year 2027.
Limitation of flat-rate cost deduction for copyright income
The flat-rate cost deduction for copyright and neighbouring rights income (50% on the first indexed €10,000 of income and 25% on the indexed portion between €10,000 and €20,000) is now restricted to income from activities for which the taxpayer holds a valid “ordinary” or “plus” attestation of work in the arts (kunstwerkattest /attestation de travail des arts), as defined in Article 12, §8 of the Royal Decree of 13 March 2023, at the time of payment or attribution. Taxpayers who hold a “starter” attestation of work in the arts (as referred to in Article 17 of this Royal Decree) will no longer benefit from the flat-rate deduction. The flat-rate deduction of 15% of the gross amount is likewise reserved for holders of an attestation of work in the arts: only income linked to recognised activities, i.e. activities falling within the scope of the attestation of work in the arts, will qualify for the flat-rate deduction. Anyone who does not hold such an attestation will no longer be entitled to claim any flat-rate deduction for expenses and will instead have to substantiate actual expenses if they wish to deduct them from the gross amount of their copyright income. This measure takes effect retroactively from 1 January 2026, although, for the purposes of withholding tax, it only applies to income paid or attributed from the tenth day after publication of the law.
It should further be noted that the copyright regime remains subject to pending legislative developments. In particular, the draft law on personal income tax reform (Article 74 of the draft law) provides the re–inclusion of computer programmes (software) within the material scope of the copyright regime, through a modification of Article 17, §1, 5° of the Income Tax Code that includes programmes referred to in Article XI.294 of the Code of Economic Law. As this draft law has not yet been adopted, taxpayers deriving copyright income from software should be aware that the scope of the copyright tax regime may be broadened in the future, but these changes are not yet in force. The current programme law does not address this specific point and is limited to the conditions for applying the flat-rate cost deduction as described above.
Liquidation reserves and VVPRbis
Several significant changes are made to the liquidation reserve and VVPRbis regimes:
VVPRbis:
For cash contributions made on or before 31 December 2025 and after 31 December 2025, dividends distributed in the profit allocation for the third financial year following that of the contribution (and subsequent years) will be taxed at a rate of 18% rather than 15% if the distribution takes place after 1 June (if the law is still published in the Belgian Official Gazette in May) or after 1 July 2026 (if it is published in June). This means that, for dividends deriving from contributions made before 31 December 2025, the 15% rate will remain applicable if the distribution takes place before 1 June (if the law is still published in the Belgian Official Gazette in May) or 1 July 2026 (if it is published in June). In this regard, given the tight timeline for publishing the law in May, we anticipate it will be released in June, with it taking effect on 1 July 2026.
Liquidation reserve
- For reserves created after 30 December 2025, the reduced rate that currently applies after a 3-year waiting period is increased from 6.5% to 9.8%. This new rate applies to dividends paid or attributed from the tenth day following publication of the law. For reserves added on or before 30 December 2025, the 5% rate remains available for reserves held for more than 5 years and the 6,5 % rate for those held for 3 years. The amendment providing that the allocation to the liquidation reserve must have taken place before or after 30 December 2025 (rather than 31 December 2025) has the effect that all companies whose financial year coincides with the calendar year and that close their accounts on 31 December automatically fall within the scope of the new regime.
- Anti-abuse provision: the anti-abuse provision targets situations in which a liquidation reserve is distributed tax-free upon the dissolution of a company, while its business activities continue within another company. If the recipient of the payment becomes a director of that other within three years following the payment, the amounts received will be treated as a taxable dividend and taxed at the standard rate of 30% in the taxable period during which the recipient became a director of the other company for the first time. The taxpayer may provide evidence to the contrary and prove that the acts carried out were justified by reasons other than obtaining a tax advantage. Operations carried out before the law’s entry into force cannot, in principle, be subject to this general anti-abuse provision, since the taxpayer cannot contravene a law that has not yet been applied. Entry into force will occur on the first day of the month following the month of the publication of the law in the Official Gazette.
- Anti-abuse provision (change of financial year): any change to the closing date of a financial year made on or after 24 November 2025 that is not chiefly justified by reasons other than tax avoidance, will be disregarded for the purpose of determining when reserves were added to the liquidation reserve. This rule applies to dividends paid or attributed from the tenth day following publication of the law.
Withholding tax exemption — correction factor
A new correction factor is introduced that will gradually reduce the amounts of professional withholding tax that employers can exempt from remitting to the Treasury under the existing withholding tax exemption schemes (e.g., for shift work, night work, R&D, overtime, athletes, etc.). The correction factors are set at:
- 97% for remuneration paid between 1 January 2027 and 31 December 2027
- 93.35% for remuneration paid between 1 January 2028 and 31 December 2028
- 95.9% from 1 January 2029 onwards
These percentages may be adjusted annually by Royal Decree deliberated in the Council of Ministers, no later than 31 December of the preceding year and no later than 31 December 2028. This measure enters into force on 1 January 2027.
Night and shift work – withholding tax exemption
The conditions for the withholding tax exemption for shift and night work are modified. The shift premium must increase remuneration by at least 2% per hour of shift work and must be laid down in a collective bargaining agreement (CBA), work regulations, or an employment contract. The night premium must increase remuneration by at least 12% per hour of night work and must likewise be stipulated in a CBA, work regulations, or an employment contract. These changes apply to remuneration paid or attributed from 1 June 2026.
Occasional workers in the fruit & vegetable sector – withholding tax exemption
A new withholding tax exemption is introduced for employers in the fruit & vegetable farming sector who hire occasional workers. The exemption amounts to €1.30 per hour for occasional workers, linked to the health index which will be adjusted annually. This measure replaces the provision annulled by the Constitutional Court (judgment no. 86/2025) and applies to hours worked from 1 January 2026.
Social and employment measures
Temporary limitation of wage indexation
The Programme Law temporarily limits wage indexation for employees and civil servants earning over €4,000 gross per month (full-time reference salary). While salaries up to €4,000 remain fully indexed, the portion exceeding this threshold receives limited or no indexation until the 2% moderation target is reached.
This moderation will happen over two periods.
First moderation period (from 1 June 2026)
- The salaries of civil servants and contractual employees working in the public sector are indexed with 2% each time the pivot index is surpassed. This will happen after 1 June 2026 for the first time; the portion of the salary that exceeds the €4,000 monthly reference will not be indexed.
- Private sector indexation mechanisms vary from 1% or 2% increases when the pivot index is surpassed to monthly/quarterly/annual indexations at variable percentages. Sector-specific scenarios therefore apply after 1 June 2026. If the first post-June 2026 index cycle is below 2%, no indexation applies to salary portions exceeding €4,000/month, and subsequent cycles on that portion remain limited until the full 2% moderation is reached. If the first cycle exceeds 2%, a two-step calculation ensures the excess indexation above the 2% limit still applies to the employee’s entire salary.
Second moderation period (from 1 January 2028). The same 2% indexation moderation mechanism will apply a second time in 2028. However, the €4,000 threshold will be indexed.
Special wage moderation contribution. Employers will be required to pay half of the return resulting from the indexation limitation to the National Social Security Office. During both moderation periods, this will be done through a specific temporary wage moderation contribution. After 2028, a permanent wage moderation contribution (percentage still to be determined) will continue to apply on salaries that exceed the reference salary threshold.
Limitation of social benefit indexation
Social benefits (statutory pension, disability, invalidity, maternity, unemployment) are indexed by 2% each time the pivot index is exceeded, mirroring public sector salaries. The same 2% indexation limitation will apply twice – once from June 2026 onwards and a second time in 2028 – but with a €2,000/month threshold: benefits below this amount are fully indexed, while portions exceeding it will not be indexed on both occasions. Self-employed social benefits follow similar rules.
Social employment bonus
The parameters for the social employment bonus – a reduction in employee social security contributions for low to mid-range salaries – will be expanded to include more employees. The aim is to strengthen the purchasing power of employees with moderate incomes.
Target group social security contributions reduction
The target group reduction of social security contributions for a company’s first hirings will be expanded from the first three hires to the first five. This change enters into force on 1 July 2026.
The target group reduction for collective working time reduction and the four-day workweek is abolished as of 1 July 2026. Employers who introduced such schemes before 1 July 2026 may continue to apply the reduction for the remaining duration of the scheme.
The current lump-sum reduction of social security contributions for permanent employees with a full-time employment contract in the hospitality sector will equally be abolished as from 1 July 2026.
Limitation of NSSO salary cap exemption
The exemption from employer social security contributions introduced last year for the part of an employee’s salary that exceeds the quarterly cap (currently set at €86,700) will no longer apply for remunerated athletes and professional cyclists for whom the employer already enjoys a social security contributions reduction. This measure enters into force on 1 April 2026.
Digital social security
From 1 January 2027, employers will be able to transmit salary and performance data to the NSSO on a monthly basis. This monthly data transfer will become mandatory for all employers from 1 January 2028.
What’s next?
The Programme Law introduces a broad range of measures that will affect businesses and individuals across Belgium. The wage moderation measures and the correction factor for withholding tax exemptions will have a direct impact on employer payroll costs and administration. The increased tax rates on liquidation reserves (from 6.5% to 9.8%) and VVPRbis dividends (from 15% to 18%) are particularly relevant for SME shareholders planning distributions – note that a distribution of dividends from cash contributions made before 31 December 2025 can, under the VVPRbis regime, still be taxed at 15% if the operation takes place before 1 June or 1 July 2026, depending on whether the law is published in May or June in the Belgian Official Gazette (given the tight timeline for publishing the law in May, we anticipate it will be released in June, with it taking effect on 1 July 2026). The new anti-abuse provisions targeting liquidation reserve distributions require careful attention from directors who may be considering a transition to a similar business within the three-year look-back period.
The various entry-into-force dates, some of which are retroactive (as is the case for copyright income measures applied from 1 January 2026) and some of which staggered over the next few years, mean that businesses and their advisors should map out timelines carefully and assess the impact on their specific situations.
For more details or to understand the impact on your company, feel free to reach out to your PwC representative.
Author: Christoph Zenner (PwC Belgium)
