Tax incentives attract investments in Belgium

Il y a 5 years

Belgium enacted a partial exemption of the salary withholding tax for trained researchers in 2008 in order to encourage investment in research and development and to attract and retain talent. The government has recently extended this rule to 80% exemption. A beneficial addition to this improvement would be to expand the limited range of scientists who currently benefit from the measure and include people with other relevant degrees or equivalent experience.

A tax exemption, of course, means less revenue for the Belgian treasury, but the results are justifying the costs. Although Belgium has had trouble meeting European R&D targets in the past, newer data show a growth in the amount of foreign investments in R&D since the introduction of the regulation in 2008.

The EU 2020 Strategy sets EU countries the target of investing 3% of their GDP in R&D by 2020. In 2008, Belgium spent 1.92% of its GDP on R&D, in 2010 this had risen to 1.99%. With this steady improvement, Belgium is exceeding the EU-27 average and drawing closer towards the OECD average of 2.4%.

Belgium’s strengths lie in its specialization, innovation capacity and large patent portfolio, all of which attract significant amounts of foreign investment. Pfizer, for example, has invested €140 million in its Puurs site. These features are also important to the knowledge economy. One of the strongest sectors in this regard is the biotechnology sector.

Source: AmCham

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