Proposition 51K1197

Projet de loi modifiant les articles 196, § 2, et 216, 2°, b, du Code des impôts sur les revenus 1992.

General information ¶

Submitted by

PS | SP MR Open Vld Vooruit Purple Ⅰ

Submission date

June 8, 2004

Official page

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Status

Adopted

Requirement

Simple

Subjects

direct tax corporation tax

Voting ¶

Voted to adopt

Vooruit Ecolo PS | SP Open Vld MR FN VB

Abstained from voting

CD&V LE

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Discussion ¶

July 8, 2004 | Plenary session (Chamber of representatives)

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Mr. President, Mr. Bogert, rapporteur, refers to the written report.

Mr Bogert is in the Flemish Parliament.

No, Mr. Tommelein, Mr. Bogaert is not in the Flemish Parliament but has a seat in the Chamber.

Not yet, Mr President.

Maybe he will return!

Mr. Chairman, Mr. Minister, colleagues, the CD&V will abstain in relation to this bill.

This bill is a small correction to a failing tax legislation and is partly in line with Bill No. 763, submitted by colleagues Pieters, Bogaert and myself, which aimed to make the application of the reduced rate and a number of other tax benefits for SMEs subject to the criteria of Article 15 of the Company Code.

The Minister submitted this draft as a response to the destruction by the Arbitration Court of a part of Article 196 of the Income Tax Code. We regret that this bill once again reflects a fragmentary approach, without a vision on companies and taxation and investments and employment, at a time when unemployment peaks and the number of bankruptcies reaches a historic record.

I also regret the sterile way in which this bill was dealt with in the committee on 22 June. From page 4 to page 10 of the written report you can find my argument. I will not repeat them. The Minister’s response was limited to the observation that this bill is a positive measure, which, of course, is a very weak defense for such a bill.

I found it quite annoying that the committee refused to postpone the discussion of the draft until after the hearing on corporate tax, which would take place the same afternoon. Despite the fact that President de Donnea was also pleased with this question, she was abstained on the proposal of the Minister. I was very surprised at the attitude of the VLD — I see that there is a number again — a party that is full of mouths about the protection of small and medium-sized enterprises, but which found this bill not worth discussion. Even more striking, in the afternoon at the hearing, where 12 experts from the business and academic world were present on the subject of corporate tax and KMO — with representatives of VBO, VOKA, Union Wallonne des Enterprises, Unizo, Union des Classes Moyennes, Belgian Institute of Accountants and Fiscal Advisors, professor Autenne of the UCL, professor Haelterman of the KUL and professor Verhoeye of the University of Gent — the VLD was again absent.

Let me speak, Mr Tommelein.

Mr. Devlies, I don’t know where you get that. You probably looked wrong. I was present at that hearing. If you say that the VLD was not there, you are lying here or you do not know what you are talking about.

Mr. Tommelein, I had asked to let me speak. I refer to the interesting explanation that the Prime Minister gave here last week and to the absences he thought he should continue with respect to another committee. It is not my habit — and I do not wish to make it a tradition — to make such remarks. However, if the Prime Minister of this country gives the example, I can only follow his example. Their

So I take the absence list and I will first mention the absent ones. Mr Daems Hendrik is absent. Mr Goris Stef, absent. I work a little in the tradition of the Prime Minister last week. Mr Borginon Alfons, absent. Mr Cortois Willy, absent. Mr Pinxten Karel, absent. Mrs Turtelboom Annemie, absent. Mr. Bart Tommelein has indeed entered the hall twice. I would like to confirm that. The colleagues present here who also participated in that meeting will also be happy to confirm that. He actually entered twice during the hearing. I want to tell the truth.

However, it would have been better to have been present, both the minister and the members of the VLD, because then they could have been aware of the enormous problems of the business, as well as a number of suggestions. It was stated that Belgium is no longer competitive in terms of corporate tax. Other countries are not silent. Reductions in corporate tax have already been announced in Austria, Finland and the Netherlands. In addition, there is a large difference between the nominal rate and the actual rate in Belgium. Due to the increase in the number of rejected expenses, the real tax burden increases. In this context, the attendees spoke of embarrassment over the non-retractability of regional taxes which have extensive consequences for environmentally-intensive companies and companies with small profit margins.

The difference in tax pressure between large enterprises and SMEs is ⁇ high. A small and medium-sized enterprise pays twice as much tax as a large enterprise. This is also worth a discussion.

There is a fundamental problem in the financing of SMEs. The investment reserve is so complex that it is virtually not used. There is, by the way, a manual by Peter Verbanck that covers 100 pages and relates to the investment reserve. This, of course, is also a way to save money: regulation is so complicated that no one can expect it and therefore does not appeal to it. Professor Hauthel argued that the tax benefits are too much focused on investments and that it would be better to prefer tax benefits to the sources of financing.

Mr. Minister Reynders, I had a discussion with you last Tuesday in the Committee on Finance. I found there that you have some ideas about the equal tax treatment of equal and foreign equity in companies. We are in the same wavelength.

However, I have found that at the time we became concrete and that I asked you whether your coalition partners agreed to these ideas, you remained guilty of the answer. I have found, looking at the banks of the PS commissioners, that one was little enthusiastic about what you had told. The possibility of realization of these ideas is, unfortunately, limited.

Other problems relate to the legal uncertainty surrounding the DBI. I can, of course, continue this way, because the number of problems affected by these business leaders, by these experts, was ⁇ large. Mr. Minister, I also noticed that the Flemish companies are beginning to become inappropriate and that they no longer accept that such a policy is being carried out. The speech was taken by Mr. Muyters, Deputy Governor of the VOKA, the dome that covers the Chambers of Commerce and the former Flemish Economic Union. He has made it clear that the regionalization of corporate tax is an urgent requirement to be realized.

It is then about regionalization in the sense that opcents or discount can be levied.

Mr. Minister, all these topics were indeed worth discussing, both for you and for the VLD. The draft law that is presented now is flooding work. It is not a solution. The fiscal policy of SMEs is completely on the slope. You know that very well. There is the decision of the Arbitration Court. There is the opinion of the State Council, which is also clear and clear with this bill. It stipulates that the profit criterion cannot.

Mr. Minister, it is also ⁇ illogical that a company or enterprise is a SME for one year, the following year — depending on profits — is not a SME, and that the company should wait for the third year for the tax inspection to know if it is a SME. This is not a way of working. The State Council and also the Arbitration Court have made clear statements. You know that in the coming years there will be four other destruction arrests. A good, forward-looking policy would consist in formulating now a number of proposals taking into account the opinions of the Court of Arbitration and the Council of State and the opinions given by the business community and by experts from the academic world.

However, I assume that you will not take this into account again.

Mr. Speaker, I can still replicate to the presentation Mr. Devlies.

Then you should have registered on the speaker list, Mr. Tommelein.

I would like to speak for a personal fact.

Mr. Tommelein, with such a wide back, a personal fact must be a heavy fact.

Mr. Speaker, I will go to the

Mr. Devlies gave me my wife’s phone number. According to Mr. Devlies, I entered the hall twice during the committee meeting, while I was present almost the entire afternoon. Their

Mr. Devlies, what you are doing is not serious. You know perfectly well that you and your group were not present during the discussion of budget control. Your group, however, finds this discussion very important. You were also not present at the vote. This is perfectly controllable. In your opinion, it is unheard of to say that you were absent during a very important discussion and a very important vote in the Committee on Finance. Well, if you definitely lie by saying that I’ve only entered the meeting room twice, then I don’t think it’s serious.

Mr. Tommelein, the word lies is not used here. There are other formulas for this.

Mr. Speaker, I propose that we set up a parliamentary investigation committee to investigate what happened that afternoon, how often Mr. Tommelein entered, how long he stayed inside, whether he speaks the truth and whether I speak the truth. Their

Mr. Tommelein, I do not like these practices. Since the first minister of this country last week found it necessary to demonstrate in this way the cohesion of his government, you understand that I can only mention these regrettable facts to your party. I have other lists and if you challenge me, I will also publish them. Dear colleague Tommelein, I think we should stop this game.

We are all slightly sinners. Let us cover this with the mantle of mutual understanding.

The incident is closed. The incident is closed.

Mr. Speaker, I was not present in the committee but I would still like to explain the CDH’s abstention vote on this bill. Article 215 defines the criteria that companies must meet in order to benefit from a reduced corporate tax rate. But other measures depend on the goodwill of companies to meet all the conditions of Article 215 of the Income Tax Code. In order to benefit from the tax credit system, in order not to have to pay the majorations for lack of advance payment, in order not to see their amortizations calculated "prorata temporis", companies must meet the conditions referred to in article 215 of the Income Tax Code.

The Court of Arbitration has addressed this problem in one of its very specific aspects: the reference to Article 215 for companies who want to benefit from amortization benefits, who want to not be obliged to calculate their amortizations "prorata temporis". In order to benefit from this system of amortization, companies must meet the conditions set out in Article 215 and in particular the requirement not to exceed a pre-defined taxable net profit. The Court of Arbitration has correctly stated — it seems to me that it has read and understood its judgment — that this criterion of taxable net profit is not a relevant condition for receiving an amortisation advantage. The Arbitration Court does not see the link between a depreciation system and a company’s taxable net profit. There is no report, no relevance of criteria. Therefore, the Court of Arbitration decided that this measure should be cancelled.

Mr. Minister, you submit here a text that responds to this very specific point. In fact, this text is no longer appealable before the Court of Arbitration. Only, you know like me that in addition to this depreciation system, other systems also depend on the criteria of Article 215, whether for the tax credit, the increase for lack of advance payment or the investment reserve. It seems to me that the Arbitration Court’s reasoning on amortization can be taken equally for these other measures which depend on Article 215.

The opportunity was truly exceptional for you to be able to use this decision of the Arbitration Court to uniformise the system and ensure that these measures outside the tax rate, whether in terms of investment reserve or advance payment, no longer depend on this Article 215. You could have used the reasoning of the Arbitration Court to uniformise the system and no longer make companies dependent on their taxable net profit. It can be understood that a company experiences certain difficulties in planning its finances or budget, in terms of investment, amortization or advance payment when all of these measures depend on their taxable net profit. How do you want a company to know in advance what it will earn at the end of the year and the set of measures that will result from it, whether at the level of tax or these attached measures?

If the company, because it has been well managed, that it has earned money and that it has worked well, exceeds a net taxable profit of an amount which I do not know from heart but which is included in Article 215, it can no longer benefit from the reduced rate; likewise, the set of measures resulting from it also falls, whether in the matter of amortization, point on which the Arbitration Court decides, but also in the matter of reserve of investments and the increase of advance payments.

Mr. Minister, I had already highlighted this problem when you had increased the minimum income of administrators. I said the same thing was happening. Indeed, a company that gave too little to its administrator would fall into a higher tax rate. Therefore, it can be easier to plan your budget and accounting. This really hurts the management of companies, it does not allow them to have legal certainty in the matter.

That is why, Mr. Minister, I submitted a bill, which you have ⁇ read, which unifies the notion of SMEs and makes it much more coherent. This concept must be the same in all measures, whether to benefit from the reduced rate or from all other measures regarding advance payments, amortization and investment reserve. We must be able to unite.

As soon as the company fulfils both the qualitative and quantitative criteria that are included in our definition of SME and that are included in the bill, it can benefit from all these fiscal measures that are good – you will not contradict me, Mr. Minister – and that can allow SMEs to have the status that is due to them and that they must have. In this way, the true economic fabric of our Belgium, these 240,000 SMEs know if, yes or not, they enter the criterion for defining a SME, if, yes or not, they can benefit from all these annexed measures at the tax level and whether, yes or not, they can benefit from this reduced rate in matters of corporate tax.

In conclusion, Mr. Minister, I think that, if you answered the Court of Arbitration on a timely basis, you did not seize the penalty it placed on you in order to make tax policy more coherent in terms of support to SMEs and to allow companies to invest long-term, to have proper legal certainty in order to better manage our economic tissue, our 240,000 SMEs in Belgium.

Thank you Mr Wathelet. I was looking at the new plan of the hemisphere: the editions follow one another and do not resemble.

Mr. Speaker, I would like to remind you that if the government had to resume working on this provision, it is because we have experienced the phenomenon of the irrigated irrigator. Companies wanted to submit the text to the Arbitration Court hoping that the provision would be cancelled in order to maintain the old depreciation system for everyone, including large companies, and the opposite obviously happened.

It must be understood that this is a surprising situation. These are companies that eventually got before the Arbitration Court to penalize the companies themselves. This becomes a custom, just recently we talked about a parliamentary who achieved before the State Council to favor fraudsters while in principle his political formation was against ethically. This is the phenomenon of the irrigated irrigator that occurs from time to time.

Furthermore, what Mr. Wathelet is accurate. We have addressed the situation caused by the arbitration court’s decision on a particular point, but by allowing a few tens of thousands more companies to benefit from the special provisions for SMEs in our new corporate tax legislation. This is not only a correction but also an improvement. I am therefore surprised that groups that talk continuously about support to SMEs abstain from a text that only improves the situation of a number of SMEs that were not covered in the previous text.

I do not exclude the possibility of going further. We will have the opportunity to debate the corporate tax again, probably in the next parliamentary year, and I hope that further progress can be made in this matter. I here inherit a very old text that has been applied for very many years and we are gradually correcting it according to the possibilities of the agenda. I think it is already a very good thing that this correction is made and that it leads to an improvement in the situation of a large number of undertakings which were not covered by the previous provision.

Mr. Speaker, Mr. Minister, I would like to talk about the abstinence. We are not opposed to this bill, which, by the way, is in the extension of the bill that we have submitted ourselves. It is substantially going in the same direction.

For a few minutes I have tried to explain what it is about, in particular the lack of coherence and the fact that you do not seize this opportunity to address the corporate tax as a whole.

I would also point out to you the dangers that exist or the decisions that will come from the Court of Arbitration on the same basis as the ruling requiring you today to make this adjustment. The advice we give you is to develop a comprehensive vision of corporate tax and to submit the necessary draft laws.

Mr. Speaker, just to correctly redefine my recent intervention, this abstinence is absolutely not a non-support to SMEs. Even if he tried to say the opposite, I think the minister understood it well. Indeed, we believe that we must go further, not only to truly support SMEs, but also to ensure more coherence: that there be reference to a single definition, that there is no, in terms of amortization, a definition of the Corporate Code, in terms of investment reserve, a definition of Article 215 of the Income Tax Code, and for the rate, it is also Article 215 of the Income Tax Code. A coherent system with one and the same definition! You meet the quantitative, qualitative criteria, you are a SME, you benefit from all tax provisions and benefits. If you are not one, you are not benefiting from it! This is clearer, it is more consistent, it offers better legal certainty.