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Unformatted text preview: Personal income tax
Radio-TV Germanspeaking Flemish Region
Community and Community 0,2 BrusselsCapital
Region CoCOM CoCOF 338,8
- - 19,7
14.2 12,2 1,0 4,5 6,8
9,7 7,9 2,1 4,3
4,3 4. Total 184.8 241,8 4,7 629,4 60,6 2,1 8,6 5. Expenditures 194.5 246,3 4,8 619,5 65,9 2,1 8,8 6. Balance
Two-Community Commission, 2 French Community Commission (1999 figures).
Source: Ministry of Finances, Bulletin de Documentation, Annexe Statistique – 2000 edition.
(1 Є = BEF 40,3399) +9,9 -5,3 0,0 2 -0,2 1 22 The mechanism is, in reality, more complex since a transitional correction had to be introduced to reflect that French-language education initially
represented not 42.45% but 43.51% of the cumulative expenditures of Dutch- and French-language education (see Spinoy (1998)). 187 Commission on Fiscal Imbalance 4.3. The spring 2001 agreements
The so-called Lambermont or Saint-Polycarpe agreements, reflected in legislative terms in the special law of July 13,
2001 transferring various fields of jurisdiction to the Regions and the Communities and the special law of July 13, 2001
respecting the refinancing of the Communities and the extension of the fiscal jurisdiction of the Regions, extended
regional jurisdiction, especially in the realms of agriculture, foreign trade and authority over local powers, broadened the
means of the Communities23 (means that were increased, indexed to inflation and, starting in 2007, partially to growth,
and the apportionment of which between the French Community and the Flemish Community will, from now on, depend
not only on the number of students but also on personal income tax revenues) and the Regions, especially with regard
to the latter, through the attribution of broader fiscal autonomy.
With reference to Valenduc (2002) and the legislation, we can reexamine the fate of personal taxes and personal income
tax. Another useful reference is Van der Stichele and Verdonck (2001).
First, the fate of the Communities demands brief examination. The additional means attributed (assuming a constant 3%
inflation, a 2% real growth and stability in the proportion of young people in the population under the age of 18) would
rise, according to my calculations, from 8 billion BEF (0.20 billion €) in 2002 to almost 123 billion BEF (3.05 billion €) in
2012, i.e. an increase in means of 2% at the beginning of the period to 23% at the end of the period. However, these
additional means will be gradually apportioned more extensively according to the so-called principle of fair return, i.e. to
personal income tax revenues, 80% of Brussels’ revenues being allocated to the French Community and 20% to the
Flemish Community. This will mean a reduction in the distribution of means based on needs (supposed to be in line with
the number of students). The French Community accounts for 43% of students but only roughly 36% of tax revenues
and its share of the additional means would decline from 40% to 36% in 10 years and its share of overall VAT financing,
from 42.8% to 41.6%. It should be noted that the personal income tax por...
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