VAT reduction on energy not yet off the table

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Minister of Finance Vincent Van Peteghem (CD&V) hopes that the government will make a decision in the coming week about a VAT reduction on gas and electricity. He said that on Radio1 on Saturday morning.

Energy prices are exceptionally high at the moment. According to Van Peteghem, this requires exceptional measures. But even if not everyone is convinced of a VAT reduction yet, the minister does not want to brush the plan off the table yet. There was new consultation on Friday, hopefully a decision will be made next week, it sounded Saturday morning before the microphone of Michaël Van Droogenbroeck.

“Not only the lowest incomes, but also the middle class sometimes finds it difficult to pay the energy bill or the advances now that the prices have doubled or even tripled for gas. Some families even have to work on their savings. That is why we have again seen what is possible. In the long run, we have to make a number of adjustments that have an impact in the longer term. Structural solutions. But now we have to act quickly,” says the minister.

He has been instructed by the government to look at all options together with the Minister of Energy. Also the proposal of the French-speaking socialists to give energy cheques.

According to Van Peteghem, it is striking that the VAT on coal, which is very polluting, is still 12 percent and that on electricity, the most sustainable energy source, 21 percent.

According to Van Peteghem, a VAT reduction on energy would cost about 86 million euros per month. That is a lot, he says, but we have also allowed the catering industry a VAT reduction to bridge the corona crisis. That cost our country about 800 million euros.

Van Peteghem hopes that the government will make a decision this week.

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