Foreign tax dodge law ‘nets half amount hoped’

17 February 2005

BRUSSELS – The Belgian government was expected on Thursday to admit that a controversial ‘foreign tax dodge’ law had raked in just half the amount it had predicted.

The tax amnesty, introduced last January, gave people a year to declare earnings hidden abroad in return for paying a lenient tax rate on them of between 6-9 percent.

Tax evaders were warned that after the December 31 deadline, the authorities would come down hard on anyone with undeclared cash, bonds and shares.

At the start of 2004, the government said it expected around EUR 850 million to be legalised under the One-Time Voluntary Declaration scheme, but had to rapidly downscale its expectations when little overseas cash was declared in the first few months of the amnesty.

On Thursday, the media estimated that Finance Minister Dider Reynders would announce a final haul of around EUR 400 million.

The figures were based on some of the first announcements from financial institutions and financiers.

For the first time, Fortis Bank revealed customers had made a total of 5277 declarations, amounting to EUR 985.8 million in declared capital, with some EUR 87 million in fines being paid.

It said the average fine for its customers was EUR 16,158, with the smallest fine being just EUR 4.43 and the highest totalling EUR 1.02 million.

The bank Delen, which specialises in investment banking, revealed it had netted EUR 300 million for the tax man from just 900 declarations. The average fine amounted to EUR 33,000.

The final government figures are expected to show that more than two-thirds of the declarations were made in December, the very last month of the amnesty.

At Fortis, some 60 percent of those making declarations lived in Flanders, compared to 24 percent in Wallonia and 17 percent in Brussels.

For every 100 declarations made, 39 were related to sums kept in Belgium, 34 came from money made or kept in Luxembourg, 15 percent from the Netherlands and 9 percent from Swiss accounts.

The remainder of the legalised funds had been held in Germany or France.

[Copyright Expatica 2005]

Subject: Belgian news