25 July. — The Belgian newspapers De Standaard and Le Soir published an interview with Prime Minister Charles Michel (Reformist Movement). His chief and most striking message was an announcement regarding a radical tax fraud fighting measure. The head of government proposes depriving major fraudsters of their electoral rights.
As elsewhere in Europe, Belgium is concerned about large-scale tax evasion and avoidance schemes. In early June, the coalition government submitted a new draft law on the so-called “Cayman tax” (transparency tax) where the principles of look-through taxation and personal income tax are applied to the owner or beneficiary whether he or she has really received any income or not. To avoid double taxation or undeserved tax liability, residents of Belgium will have to prove who the real beneficiaries are, what they receive, and how much they earn.
Based on the estimations of the National Bank of Belgium, up to €57bn belonging to Belgians are located in offshore accounts. The government anticipates getting at least €460m out of them.
No less drastic are the plans being discussed with regard to tax evasion. Judging from the statistics, the measures adopted earlier are not producing the expected results. In 2014, the fight against tax fraud brought Belgium €1.385bn. Now, the government intends to place even stronger pressure on tax evaders.
In May, the issue was removed from the jurisdiction of State Secretary Elke Sleurs and given to Finance Minister Johan Van Overtveldt. (Both of them are members of the New Flemish Alliance.) It has been two months since the Prime Minister began advocating tougher punishments on tax crimes. “If a judge finds the defendant guilty of large-scale tax evasion, he can deprive him of his political rights, including the right to vote and run for election,” explained Charles Michel in the interview.
Far from everyone, however, understands the new measures or believes in their effectiveness. The Socialists have made a habit of reproaching the Prime Minister, accusing him of only presenting the semblance of a struggle. The new measure evoked the same predictable reaction. In the words of Deputy Ahmed Laaouej, Michel, “is shooting at tax offenders from a water gun” with this initiative (Le Soir).
University of Liège professor Adrien Masset noted in a Le Soir interview that a similar measure is already in place. This would be Article 33bis of the Belgian Criminal Code, which in turn elaborates on Article 31. There it is stated that in cases of serious offenses punishable by sentences of 10 years through life imprisonment, the guilty party loses the right to be elected for five to ten years. The expert is certain that major tax evaders will not be worried about the loss of political rights.