The impact of the budget agreement

Tax on financial capital gains

Although the vote will most likely not take place until after the New Year, the agreement (as already agreed in the summer accord) nevertheless provides for a 10% general tax on all capital gains realized as of Jan. 1, 2026. The first €10,000 of annual capital gains will be exempt and capital losses in the same year will be deductible, but not transferable.

For a "substantial interest" of at least 20% of the shares held, there is an exemption up to €1mio and then graduated rates (starting from 1.25%), where the 10% rate will only apply from €10mio.

The capital gain is determined by the difference between the acquisition value (or value on 1/1/2026) and the sale value.

With respect to corporate income tax:

Standard withholding tax rate for dividend distribution = 30%

• The reduced rate for profit distributions via VVPR-bis (by small companies) will increase to 18% with an (unchanged) waiting period of 3y. No transitional regime is foreseen here. It may therefore be advisable to provide for an interim or interim dividend at 15% this year.

The "interim rate" after two years of 20% is no longer applicable.

• In the case of liquidation reserves, the withholding tax is increased to a total tax burden of 18%. Distributions on liquidation do remain exempt from withholding tax and the waiting period drops from 5y to 3y.

Reserves created before 31/12/2025 remain subject to an optional regime:

• Either 5y waiting period -> 5% rate
• Or 3y waiting period -> 6.5%

• Stricter supervision of management companies to avoid abuse

With respect to wage earners:

• For wages higher than €4.000 in 2026 and 2028, the portion above €4,000 will not be indexed
• Those worker will receive a "fixed cent index" calculated at €4.000 (e.g., 2.0% on €4,000= €80)
• Employers do have to calculate the indexation on wages above €4,000 but have to pay half of it to the state treasury.
• The same principle applies to pensions and benefits above €2,000
• Wages of Ministers and MPs will not be indexed during this legislature.
• The minimum wage will increase by €50 from April 1, 2026, due to an increase in the work bonus.

Tax on securities accounts:

• This doubles from 0.15% to 0.30% for securities accounts with an average value of more than €1mio. Four metrics are used here: 31/12,31/3,30/6 and 30/9.

New (or higher) taxes:

• A parcel tax of €2 per package from non-European web shops
• A flight tax of €10 (was €5)
• A new bank tax

VAT and excise tax reforms:

• No general VAT increase but:
• 12% VAT on:
  • Hotels,
  • camping,
  • entertainment,
  • take-away meals
  • cinema and festival tickets
  • non-alcoholic beverages in the hospitality industry
• 21% VAT on pesticides (was 12%)
• Decrease in excise taxes on electricity
• Increase in excise taxes on:
  • Natural gas
  • Benzene
  • Diesel
  • Fuel oil

Social measures:

• Sickness periods count for pension and pension malus
• First year of work = full year for calculation of pension
• Activation of 100.000 long-term sick people (= ambition)
• Increase in out-of-pocket fee (no details yet)
• Growth standard in family care reduced to 2.5%, although additional investment is anticipated

Several measures:

• Shift of tax cut: partly brought forward to 2028, partly postponed to 2030