Symbol tax targets investors: part 2
As of 1 January 2018, investors with €500,000 or more will be required to pay an annual securities tax of 0.15% on their securities portfolio. The securities in question are bank savings certificates, investment funds (both listed and unlisted), bonds (both listed and unlisted), warrants and quoted and unquoted shares. The registered shares, pension savings and life insurances are not affected, whereby the estimated revenues now already seems unattainable.
Those who in the future have an average of €499,999 on their securities account, will not have to pay anything. All those who have an average of €500,000 or more, will have to pay. In other words, a measly difference of €1 could soon mean paying €750 in taxes.
"After the repeal of the speculation tax, the government, with the securities tax from the summer agreement, seems to have found a symbol for equitable taxation. In doing so, they almost exclusively looked at investors. Having only just recovered from the consecutive increases in withholding tax, an earlier doubling of stock market taxes and the infamous speculation tax, these investors will soon see their stock market taxes on shares increase again by roughly 30%," says Thierry Ternier, CEO of Keytrade Bank. "We had already warned them at that time with the speculation tax and sounded the alarm. We are doing the same now."
This securities tax did not seem very well-thought-out when the government announced it in the summer. Now that the main terms have finally been set out after some serious squabbling at the heart of the government, it seems that this tax is already heading in another direction than planned. First, there are questions on the legal feasibility and practical implementation. Secondly, just like with the speculation tax, we can now also predict that private investors will adapt their behaviour. This led to a drying up of the stock trade last time, and will now perhaps lead to evasive behaviour if we take the Google search terms as a precursor. Let's hope active investors will not bid Belgium farewell.
Thierry Ternier: "Continuously changing the rules is disastrous for the stock market. If there's one thing stock markets react to, it's uncertainty. When this measure soon yields much less than expected, those in government circles will probably revert back to their traditional solutions. They will either lower the minimum amount or raise the rate as they did with the stock market taxes. As a result, any notion of fiscal equity will be lost."
There is, however, a positive note to the summer accord. "The withholding tax exemption for dividends on shares up to €627 is an outstanding measure. Hopefully, this will ensure that the 'smaller' investors will dare to invest and that classic savers will sooner take a step towards making investments. Today, that classic saver is still losing purchasing power because of inflation and low interest rates."
It is still rather curious that the income from the securities tax is intended to activate citizens' savings. In essence, those who are already investing in the stock market must stimulate others to... in turn, pay the securities tax?