Foreign contractors 'discriminated' against

6th April 2006, Comments 0 comments

6 April 2006, BRUSSELS — Belgium discriminates against foreign contractors for construction projects, the European Court of Justice's solicitor-general has claimed.

6 April 2006

BRUSSELS — Belgium discriminates against foreign contractors for construction projects, the European Court of Justice's solicitor-general has claimed.

The solicitor-general also said Belgian contractors are urged against calling in sub-contractors that are not registered in Belgium.

The European Court of Justice has been advised by the solicitor-general to convict Belgium on both counts.

The case is based on a complaint lodged by the European Commission, news agency Belga reported on Thursday.

Belgium demands (at the threat of a fine) that when contractors pay the accounts of sub-contractors not registered in Belgium that they withhold 15 percent of the account.

That 15 percent must be paid to the government to cover the possible tax debts of the sub-contractors.
 
Belgian contractors are also chiefly responsible for the tax debts of foreign sub-contractors up to 35 percent of the total price of the construction works.

The Belgian government uses the system to prevent fiscal fraud.

But the EC — and now also the European Court of Justice's solicitor-general — believes Belgium is in breach of EU guidelines guaranteeing the free movement of goods and services.

The argument is that Belgian contractors are being discouraged from calling in foreign sub-contractors. Non-registered contractors face a 15 percent cut in the final bill.

Even if it appears that they don’t have any tax debts, it still takes a long time before they are repaid the money.

There is a high chance the European Court will follow the advice of the solicitor-general. A ruling is expected in a couple of months.

[Copyright Expatica News 2006]

Subject: Belgian news

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