Belgium planning further austerity

The Belgian government will reportedly have to implement a further €3 billion in fiscal measures to meet its budgetary objective for 2013, writes Tax News’ Ulrika Lomas. The reports follow the Federal Planning Bureau’s downwards revision of the growth forecast for Belgium for 2013, from 0.7% to 0.2%. The National Bank had retained a growth forecast for this year of 0%. The Federal Planning Bureau’s figures will serve as a basis for the Government’s upcoming budgetary control, due to be carried out mid-March. The Bureau currently predicts a public deficit for this year of 3% of the GDP, compared to the 2.15% provided for by the government within the framework of its 2013 Budget. At the end of last year, following weeks of intense negotiations, the Belgian Government finally agreed on additional revenue- and expenditure-based measures totalling around €3.4 billion, to balance the country's 2013 budget and to reduce the deficit to 2.15% of GDP in 2013. The additional fiscal effort will come from a €674 million reduction in primary spending, €710 million in social security savings, €1 billion in new fiscal measures and €1.3 billion from other initiatives. The supplementary measures, which are in addition to the initiatives announced in July 2012, are designed to boost both employment and competitiveness in Belgium.