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Unformatted text preview: f 8 billion BEF in 2002,
6 billion BEF in 2003, 6 billion BEF in 2004, 15 billion BEF in 2005 and 5 billion BEF in 2006. From 2007 up to and
including 2011, 1 billion BEF will be added to the indexing and an adjustment will be made in respect of growth in gross
national income (GNI).26 Starting in 2012, the entire transfer will be indexed and adjusted to growth in GNI, according to
a mechanism similar to the one applied since 1993 to the personal income tax transfer.
Once this new VAT transfer has been defined, the funds are divided between the communities under two separate
programs. The funds available had the Lambermont reform not occurred, i.e. the 1989 VAT transfer adjusted to inflation,
continue to be apportioned according to the student population criterion as defined in the act of May 23, 2000 (see
section 2.1.3.). The new funds, i.e. the absolute amounts specified by the agreement and the supplement stemming
from the linkage with GNI, are being distributed as follows: en 2002, 35% based on the allocative key applied to the
personal income tax transfer earmarked for the communities and 65% according to the apportionment rule applied to
the VAT transfer, i.e. the student population criterion. The percentage of the VAT transfer apportioned according to the
key applied to the personal income tax transfer will increase as follows: 40% in 2003, 45% in 2004, 50% in 2005, 55% in
2006, 60% in 2007, 65% in 2008, 70% in 2009, 80% in 2010, 90% in 2011, and 100% in 2012.
The new VAT transfer resulting form the Lambermont agreement increases the funds available to the two communities
but reduces the solidarity that binds them. Instead of an initial allocative criterion based solely on needs, a portion of the
VAT transfer will, from now on, be apportioned according to the communities’ taxpaying ability. This portion will be 0.6%
in 2002 and will gradually increase to 20.3% of the VAT transfer in 2011. It should be noted that when the derivation
principle is applied, a federal State usually makes provision for solidarity transfers in order to offset the principle’s
absence of redistributive effect. This is true of the regions, in respect of which the national solidarity measure was
implemented, and is true in most foreign federated States. However, no provision has been made for a solidarity
mechanism between the communities to offset the growing importance of the derivation principle in the new mechanism.
The adjustment mechanism in respect of growth in the transfer is distinct from the one applied to personal income tax
transfers. The Sainte-Thérèse agreement stipulates that “the adjustment to growth must take into account growth in GNI
but also real revenues and additional contributions that federal authorities pay to the European Union. There is an
attempt to achieve parallelism between the means available for federal authorities and the communities.” [our
To understand this statement, it should be noted that the absolute amounts added to the existing transfer mentioned in
the first paragraph stem from...
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