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14 Aug, 2017 10:33

Half of Belgium's economic output ends up in tax havens

Half of Belgium's economic output ends up in tax havens

Companies operating in Belgium sent more than €221 billion to countries local authorities regard as tax havens, according to Belgian daily Le Soir.

Belgium’s gross domestic product was $466 billion last year. According to the country's tax authorities, 853 Belgian companies funneled almost a half of the country’s economic output to tax havens.

Brussels blacklisted tax havens in 31 countries, including Monaco, the British Virgin Islands, Bermuda and the Cayman Islands. Singapore, Panama and Hong Kong are not on the blacklist, while Luxembourg was temporarily excluded.

If a Belgian company pays over €100,000 into bank accounts or to persons domiciled in the blacklisted countries, it must declare these payments.

Last year, 853 companies reported they made payments to the blacklist countries totaling €221 billion, an average of €260 million per company.

The €221 billion sum is not a record. According to the newspaper, in 2015 Belgian transfers to tax havens amounted to €274.7 billion.

However, this could be linked to the exclusion of Luxembourg, which adopted several laws based on the taxation policy. Luxembourg gets an average of €60 billion annually from Belgium, but since 2016 Belgian businesses are no longer forced to report their dealings with its neighbor.

Tax avoidance is considered legal in the European Union, but officials in Brussels have been fighting to reduce money leaving for tax havens.