Import Procedures

Customs procedures include, apart from importing with payment of duties, the following tax exemption procedures: release for consumption, transit or temporary admission, customs warehousing, inward processing, processing under customs control.

As part of the "SAFE" standards set out by the World Customs Organisation (WCO), the European Union has set up a system of import controls (Import Control System- ICS), which aims to secure the flow of goods at the time of their entry into the customs territory of the EU. This control system is part of the Community Programme eCustoms, which requires operators to pass an Entry Summary Declaration (ENS) to the customs of the country of entry, prior to the introduction of goods into the customs territory of the European Union. The EU recently introduced a new import control system called ICS2 to implement the EU customs pre-arrival security and safety programme.
The Single Administrative Document (SAD) is the official model for written declarations to customs. The SAD describes goods and their movement around the world and is essential for trade outside the EU, or of non-EU goods. Goods brought into the EU customs territory are, from the time of their entry, subject to customs supervision until customs formalities are completed. 

Since 1 July 2009, all companies established outside of the EU are required to have an Economic Operator Registration and Identification (EORI) number if they wish to lodge a customs declaration or an Entry/Exit Summary declaration.

The TARIC (Tarif Intégré de la Communauté) is available to help determine if a licence is required for a specific product. Furthermore, the European Commission maintains a trade helpdesk for exporters and importers with information regarding import restrictions of various products.

For more information please visit the European Commission's portal dedicated to Taxation and Customs Union.

Specific Import Procedures

In the framework of intra-European trade, some goods are still prohibited or subject to particular formalities (medicines for human use, waste, plants or live animals). For further information, please visit the Trade Helpdesk of the European Commission.

Distribution channels

The Belgian economy was severely hit by COVID-19 pandemic, with a fall in GDP of -5.7% in 2020 (IMF). In this context, total retail spending decreased in 2020 compared to 2019 with a direct impact on the turnovers of retailers, especially in the fashion industry. Traditional grocery retailers and shopping centers were negatively impacted but globally, the value of the Belgian food and groceries market grew by 7.2% in 2020, as a result of increased demand driven by precautionary buying (MarketLine). In 2021, sales declined slightly after the pandemic-induced spike of 2020 (Euromonitor). Among the new trends due to the health crisis, we can cite in particular the growth of small stores closer to home. Indeed, out-of-town retail is in a more favorable financial situation than on high streets and shopping centers. The fashion sector is facing difficulties while sports and leisure products are booming. Finally, among the notable trends, one must also highlight the increase in takeaway sales and home deliveries for operators in the food and beverage sector as well as the increase in e-commerce overall.
Largely open to foreign trade and home to sophisticated distribution systems and well-developed infrastructure, Belgium has attracted many foreign companies and, in return, developed a highly competitive market. Premiumisation has become more common in Belgian consumers' shopping habits. As a consequence, discounters like Aldi and Lidl have started to enlarge their offers with branded products. And, in order to compete with larger supermarket channels, Lidl has also opened a web shop.

New types of outlets such as Bio C'bon (organic range of products) are being developed, especially in Brussels area. Within supermarkets' traditional channels, stores have been upgrading because of price competition affecting their benefit margin on top-of-the-line products and because of the bad effect on brand image. Upgrading and proximity are the key factors behind the success of supermarkets and convenience stores, with convenience stores in urban areas are gaining ground at the expense of supermarkets. Overall, retailing floor space per inhabitant is relatively low in Belgium in comparison to other European countries.

The divide between the northern and southern regions of Belgium is very relevant when it comes to retailing. The Belgian Label Law states that the label on each product should be written in the language corresponding to the area where it was packaged. In northern Belgium inhabitants speak Flemish (Dutch), in the south they speak French and they speak German in the eastern part of the country. Therefore, most producers prefer to make their labels bi-lingual or even tri-lingual, especially if they also intend to export their goods. Because of these cultural differences marketing and advertising should be developed that reflect the populations of each region.
Belgians still prefer to shop in a physical shop. However, online retail has been growing exponentially for many years (mainly due to more choice and better prices) and saw a strong boost during the Covid-19 pandemic. In 2021, the sector grew by 33%, and was worth EUR 11.7 billion (Safeshops). Food retailers also benefit from this growth in online retail. Consumers favour brands that have developed an omni-channel strategy, combining online sales with a physical shop as they are considered trusted brands. 

Distribution market players

Foodstuffs distribution is organised by a few chains, as the market is highly concentrated. Distribution of other consumer goods is organised by smaller and more numerous outlets.
The group Etn Franz Colruyt NV continued to lead supermarkets in 2021, thanks to its three brands, Colruyt, Bio-Planet and Cru. Colruyt was the leading brand and remained significantly ahead of its nearest competitor, Delhaize’s “Le Lion”. Some of the other major market players are: Carrefour, Lidl, SPAR, Aldi, Intermarché and Albert Heijn (Euromonitor). In 2022, German discounter ALDI and French retailer Carrefour were the largest food retailers in the country in terms of the number of stores, with respectively 442 and 417 stores each (Statista).

Retail Sector Organisations

Federation of Belgian Chambers of Commerce

Consumption Taxes

Nature of the Tax

VAT (value added tax) - Taxe sur la valeur ajoutée (TVA)/ Belasting over de toegevoegde waarde (Btw)

Tax Rate

21%

Reduced Tax Rate

A reduced rate of 6% applies on supplies such as accommodation, improvements and renovations to buildings older than 10 years, original works of art, bikes and e-bikes, demolition and reconstruction of buildings (subject to conditions), goods of basic necessity and social services under certain conditions, books and magazines (including audiobooks) as well as e-books and other electronic publications, certain foodstuffs (milk, fish, meat, fats and oils), drugs and medicines, water, electricity, and natural gas for nonprofessional consumption.

A 12% reduced rate applies on items including public housing and restaurant services (excluding drinks), phytopharmaceutical products, certain combustible materials, margarine, and inner tubes.

Other Consumption Taxes

Excise duties applied in Belgium are divided into two categories: "community excise products" which are subject to EU procedures (such as alcohol, tobacco, petrol, gas, etc.); and "national excise products" which can be defined at the member state level on a voluntary basis (for Belgium, they consist of drinks like soda, water, and coffee).

Stamp duties are due on transactions relating to public funds if a professional intermediary intervenes in these transactions.

Corporate Taxes

Company Tax

25%

Tax Rate For Foreign Companies

A company is considered to be a resident of Belgium for tax purposes if it has its registered office, its principal place of business, or its seat of management in Belgium (i.e. the place where the corporate decision-making process actually takes place).

Capital Gains Taxation

Corporations are taxed on capital gains from tangible and intangible asset disposals at the standard corporate income tax rate of 25%, or at a reduced rate for SMEs if applicable. However, if assets are held for over five years before disposal and sale proceeds are reinvested in qualifying assets within three years (or five years in certain cases), capital gains taxation can be deferred. In such cases, tax due is spread over the reinvested asset's lifespan.

Capital gains from fixed income securities are taxed as profits, while net gains from share disposals are exempt under specific conditions, including meeting the subject-to-tax requirement, holding shares directly for at least one year, and meeting minimum holding requirements. Special rules apply to trading companies and restructuring transactions like mergers and splits, where hidden capital gains remain tax-free under certain conditions, including having principal business locations in Belgium or the EU and meeting business purpose tests.

Main Allowable Deductions and Tax Credits

Companies may deduct all business expenses when calculating taxable income, on the general condition that they are legitimate, at arm’s length and that they are incurred in order to maintain or to increase taxable income. Royalties and all fees generally are deductible without additional requirements. Various deductions and incentives are provided for R&D-related activities. Under the notional interest deduction, Belgian companies and branches are also entitled to an interest expense for qualifying equity (within a thin capitalisation/30% EBITDA limit). Belgium offers an innovation income deduction regime that reduces the effective rate of taxation on qualifying net IP income (raising the tax deduction rate that applies to gross patent revenue from 80% to 85%, resulting in an effective rate of 3.75%). A company can avail a one-time investment deduction of 20.5% for the tax year 2024, applicable to accounting periods ending between December 31, 2023, and December 30, 2024 (inclusive), based on the acquisition value of eligible investments. Additionally, concerning environmentally friendly R&D investments, a company has the option for a staggered investment deduction of 27.5% for the tax year 2024, calculated on the depreciation of qualifying environmentally friendly R&D investments.

Goodwill arising on the occasion of an asset deal can be amortised in a period of minimum five years by applying a straight-line method (client lists can be amortised over a period of 10-12 years). Start-up expenses may be deducted fully in the year of incorporation or can be depreciated over a period of up to five years. Provisions and bad debts can be deducted (conditions apply). Charitable contributions (above EUR 40 and within 5% of the total net income of the taxable period, with a maximum of EUR 500,000) can be eligible for deduction. Belgian companies can claim a deduction for royalties, management service fees, and interest charges paid to foreign affiliates (the arm's length principle must be respected). The cost of company cars can be deducted between 40% and 100% depending on the CO2 emission, with fuel costs deduction also being linked to the level of CO2 emission (from 2026 onwards, only zero-emission company cars will be able to benefit from a tax deduction).
With some limitations, tax losses can be carried forward without any limitation in time; however, a minimum tax base should be taken into account: some deductions, like DRD, innovation income deduction, and investment deduction, have no restrictions, whereas for other deductions only 70% (or 40% in 2024) of the taxable amount that exceeds EUR 1 million can be offset. This category of deductions includes carried-forward losses, among others. The remaining 30% will be taxed at the CIT rate without any deduction. Losses carry-back is generally not allowed.

The following expenses are not deductible: taxes (with some exemptions, like the real estate tax and foreign taxes), capital losses on shares, half of the representation expenses and business gifts, 31% of restaurant expenses, 17% of the benefit in kind of company cars or 40% if the fuel costs are fully borne by the company, hospitalisation insurance premiums and small gifts for employees.

Other Corporate Taxes

Indirect taxes include stamp duties, a fixed fee on increase in capital of EUR 50, a transfer or registration tax on the transfer and leasing of real estate (at rates varying between 0.2% and 12.5%). At the regional level in Belgium, an annual tax is levied on the notional rental income of immovable property, including land, buildings, and industrial equipment. The rate varies by region: 3.97% in the Flemish region and 1.25% in the Brussels and Walloon regions. Provinces and communes may impose additional surcharges. While the tax and surcharge are deductible for corporate income tax, they are not deductible for individual income tax unless the building is used for business purposes.

A 100% special assessment is applied to "secret commissions," which refer to expenses where the beneficiary isn't properly identified through correct forms filed with Belgian tax authorities. These expenses encompass various forms of professional income, including commissions, bonuses, and benefits in kind, paid to beneficiaries, as well as remuneration to company personnel or former members and lump-sum allowances for staff expenses. The reporting scope extends to variable allowances, albeit only resulting in administrative fines for omissions rather than the secret commissions tax. Additionally, income from copyrights and related rights falls under this assessment. Under specific conditions, the secret commissions tax may be reduced to 50%, and in certain instances, it may not apply at all.

Banks are subject to a bank levy and a subscription tax on savings deposits.

Social security contributions - generally fixed at 30.57% of 1.08 times the gross salary for blue-collar employees and 25% of the gross salary for white-collar employees - in practice vary according to the size and industry of the company and the salary of the employee. For blue-collar employees, an additional annual contribution of 10.27% is due on 1.08 times the gross salary.
Certain components of the salary package are subject to specific social security contributions. These include a carbon dioxide solidarity contribution for personal use of a company car, an 8.86% contribution on the employer's contribution for group insurance, and a 3% contribution known as the "Wijninckx contribution" on supplementary pension premiums exceeding certain thresholds.

An annual tax is levied on securities accounts held by both resident and nonresident individuals, companies, and legal entities, including those subject to the "Cayman tax." This tax aims to prevent Belgian residents from exploiting tax advantages by holding assets in low-taxed entities, implementing "look-through taxation" and taxing distributions. For residents, the tax encompasses both Belgian and foreign securities accounts, while for nonresidents, it applies primarily to Belgian securities accounts. However, certain tax treaties may exempt nonresident-held securities accounts from taxation. The tax rate is 0.15% on the average value of taxable financial instruments within the securities account, excluding nominative securities, exceeding EUR 1 million during the reference period, which spans from October 1 to September 30. Certain financial undertakings are exempt from this tax.

Other Domestic Resources

Federal Public Service Finance (FPS)

Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed

Federal Public Service Finance (FPS)

Withholding Taxes

Dividends: 30% (standard rate); Interest: 30%/15% on specific government bonds and regulated savings deposits; Royalties: 30% (standard rate)/15% on certain income from literary and associated rights and from legal and compulsory licenses not exceeding EUR 70,220.
Lower rates are available under double taxation treaties and specific cases.