The Government just introduced its draft bill of the so-called Program Law to the Parliament. Among other changes, we picked up the already notorious one of the social security treatment of company cars.

Context

As you may know, a 33% employer’s social security contribution (so-called solidarity contribution) is levied on the taxable benefit in kind arising from the private use of a company car. What was meant by “taxable benefit in kind” is the benefit obtained by multiplying the number of private kilometres (i.e. 5.000 or 7.500 kilometres depending on whether the distance between the home and the office is lower or higher than 25 km) by a coefficient, depending on the horsepower of the car from which employee’s payments for the private use of the car, if any, was, in principle, deducted.

News

Subject to the enactment of this provision of the Program Law, as from 2005, a new solidarity contribution will replace the current one and will be due by the employer. This new monthly contribution will be fixed in function of the CO2 emissions of the given company car irrespective of the number of driven private kilometres, of the fiscal horsepower or of the employee’s payment, if any, for the use of the car. Monthly employer’s contributions will range from EUR 20,83 for the less polluting cars to EUR 110 for the more polluting one.

It should be stressed that the above is part of the draft bill of the Program Law and may still be subject to amendment before being finally passed by the Chamber of Belgian Representatives.

The draft bill of the Program Law is available on the Chamber’s web site:
FR: http://news.hrservices.be?lk200411221
NL: http://news.hrservices.be?lk200411222