Federal government postpones VAT increase for culture, sport and takeaway meals

The federal government has decided to postpone the VAT increase on sport, culture, leisure and takeaway meals until the budget review in March. Last week, the Council of State strongly criticised these plans from last year's budget agreement.

A week ago, the Council of State tore apart part of the federal government's planned VAT reform. The institution was highly critical of the VAT increase from 6 to 12 per cent for culture, sport, leisure and takeaway meals.

“A distinction that is very unclear and not always objective,” ruled the experts of the Council of State. Concerning culture, classical music would for example be taxed at 6 per cent and a pop concert at 12 per cent, a difference that the Council of State considered unjustifiable.

The new VAT rules for takeaway meals also proved to be legally unstable. That part of the reform is therefore also being postponed, just as the parts on sport and leisure.

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The planned reduction in VAT on non-alcoholic beverages in cafés and restaurants – from 21 to 12 per cent – is also postponed in order to limit the damage to the budget.

Other planned VAT increases will take effect on 1 March. These include overnight stays in hotels and campsites (from 6 to 12 per cent) and pesticides (from 12 to 21 per cent).

At the next budget review in March, prime minister Bart De Wever wants to revisit the VAT issue with the aim of incorporating everything into a broad budgetary deal. However, the governing parties still cannot agree on the solutions.

Earlier, budget minister Vincent Van Peteghem argued for a merger of the 6 per cent and 12 per cent rates to 9 per cent. An increase in the rate from 21 per cent to 22 per cent is also a possibility. However, Georges-Louis Bouchez's French-speaking liberal party MR is absolutely opposed to this. Bouchez does not want grocery shopping to become more expensive.

^{Prime Minister Bart De Wever and Budget Minister Vincent Van Peteghem © BELGA PHOTO NICOLAS MAETERLINCK}

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