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In search of a thoroughbred: Can the government still rescue its VAT camel?
“I had a thoroughbred in mind, but we ended up with a rather ugly camel.”
With that image, Prime Minister Bart De Wever neatly captured the fate of Belgium’s VAT reform. What was meant to be a targeted and elegant budgetary measure ran aground after a sharply critical opinion from the Council of State.
The question is no longer just how to repair it, but whether the government is willing to return to simplicity.
From broad strategy to political fine-tuning
Initially, two relatively clear options were on the table:
- Harmonising the 6% and 12% reduced rates into a single intermediate rate
- Raising the standard VAT rate from 21% to 22%
Both scenarios were technically straightforward and fiscally powerful. Internal estimates suggested that a one-percentage-point increase in the standard rate could generate more than €1 billion in additional revenue.
Political reality, however, pushed the coalition toward more targeted measures. MR in particular resisted a general increase that would directly affect consumer prices.
In November, that position was explicit. On X, MR president Georges-Louis Bouchez wrote:
“With MR, promises are kept… no VAT increase, the shopping basket remains protected.”
That clear stance set expectations. Today, the VAT file is back on the table, while budgetary pressure remains. Finding a workable solution is proving more complicated than it appeared at the time.
Council of State: not a fiscal art jury
Formally, the Council of State’s verdict was clear. The draft legislation failed to adequately justify why similar goods and services would be treated differently. Under the principle of equality, differentiation is allowed, but only with a solid, objective rationale. According to the opinion, that rationale was insufficient.
Behind that legal criticism lies a broader issue. Had the reform entered into force in its proposed form, the tax authorities would effectively have become both art director and freshness inspector.
In the cultural sector, VAT rates appeared to carry implicit value judgments. Certain performing arts would remain at 6%, while festivals and many concerts would move to 12%. As if the tax code had begun ranking genres.
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That is more than symbolic. Event organisers set ticket prices months in advance. A programming decision could suddenly determine the applicable VAT rate.
The camel had already grown another hump.
The takeaway food rules were equally puzzling. The applicable rate depended on concepts such as “ready for consumption” and limited shelf life. In practice, this could mean that a fresh pizza and a similar pizza with a longer shelf life would fall under different VAT regimes.
For lawyers, a nuance. For businesses, a headache.
What began as a streamlined budgetary measure risked turning into a system in which culture and freshness were fiscally categorised. And the more exceptions added, the more humps the camel acquired.
It was precisely at that point that the Council of State decided this camel could take no further step, however hard it was being marketed as a thoroughbred.
Budgetary reality leaves little room
Meanwhile, Belgium’s federal deficit continues to widen. Recent multi-year projections show the consolidated deficit exceeding 5% of GDP by the end of the decade.
The VAT measures were expected to generate several hundred million euros. That revenue still needs to be found.
Within the governing majority, calls for simplicity are resurfacing. Business organisations such as VOKA have long argued for a coherent and stable tax framework rather than piecemeal adjustments. UNIZO similarly stresses that predictability is essential for companies making medium-term investment decisions.
Which options remain realistic?
- Back to 22%
Raising the standard rate remains the simplest and most legally robust option. From an administrative standpoint, implementation would be relatively straightforward, and the revenue yield would significantly exceed that of the abandoned measures.
Politically, however, it remains sensitive given earlier firm statements.
- Reforming reduced rates
Harmonising the 6% and 12% rates into a single intermediate rate remains intellectually defensible from a simplification perspective. Yet this path affects sensitive sectors such as food, renovation and hospitality, making political support uncertain.
- New targeted measures
Following the negative opinion, appetite for designing complex new exceptions appears limited. Legal robustness now weighs more heavily in the balance.
Conclusion
The image of the thoroughbred turned camel is likely to endure. The ambition was clear; the execution proved fragile.
With sustained budgetary pressure and recent political commitments still echoing, the government faces a delicate balancing act. The coming weeks will show whether simplicity prevails, or whether the file once again becomes entangled in technical compromise.
One observation already seems widely shared: the more humps a VAT reform acquires, the harder it is to move forward.
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Belgian labour law is once again evolving. The federal government is working on a notable reform: introducing a one-week notice period during the first six months of an employment contract.
For many SMEs, this feels like a partial return of the former probation period. But what does this mean in practice, and where do things stand today?
The measure explained
At first glance, the proposed reform is straightforward: during the first six months of a new employment contract, a fixed one-week notice period would apply, regardless of which party decides to end the relationship.
According to information from social secretariats such as Liantis and Group S, the proposal includes:
- A fixed one-week notice period during the first six months
- Applicable to both employer and employee
- Limited to new contracts only, with no retroactive effect, even for contracts currently under six months
- Automatic application, without the need for additional clauses
The objective goes beyond flexibility. In its communication, the government presents the measure as a way to encourage employers to give candidates a chance more easily, without fear of long-term commitments. At the same time, it aims to prevent premature terminations by giving employees the opportunity to prove themselves.
Not yet in force
It is important to note that the reform has not yet been implemented.
Although it has been included in political agreements, the law still needs to be formally approved and published in the Belgian Official Gazette. Only then will it come into effect.
We are now in 2026, and implementation is expected in the second half of the year. However, no exact date has been confirmed. Until then, current notice period rules remain fully applicable.
Why this reform?
Since the abolition of the probation period in 2014, many companies have faced a structural imbalance: the need to act quickly in case of a mismatch, while being constrained by notice periods that increase relatively quickly.
The reform aims to restore that balance, without formally reintroducing a probation period.
This is particularly relevant for SMEs. In smaller organisations, each hire has a direct impact on costs, team dynamics and operations. A poor hiring decision can quickly become visible.
A short and fixed notice period at the beginning of employment helps reduce that risk and allows for quicker decision-making.
What would change in practice?
Currently, notice periods gradually increase with seniority. Even in the early months, they can influence the decision to continue or end an employment relationship.
The reform introduces a single rule: a one-week notice period for the first six months.
This results in:
- Lower financial and operational risks when hiring
- Faster and clearer decisions in case of a mismatch
- Greater flexibility during the initial months
At the same time, employees may also face earlier termination during this period.
A quiet return of the probation period?
Officially, the probation period is not being reintroduced. In practice, however, the outcome is quite similar.
The underlying logic remains the same: a defined period during which both parties can more easily end the employment relationship. The difference lies in the legal structure, as it is now embedded in notice period rules.
In day-to-day practice, this distinction may feel largely theoretical.
What about existing contracts?
The reform will only apply to new employment contracts. Existing contracts will remain subject to current rules, even if they have been in place for less than six months at the time of implementation.
In practice, companies may therefore need to manage two systems in parallel, depending on employees’ start dates.
For SMEs, this will require particular attention in terms of administration and internal communication.
Conclusion
The one-week notice period during the first six months is becoming more concrete, but has not yet been formally adopted.
For now, nothing changes for companies hiring today. However, the direction is clear: more flexibility at the start of employment relationships.
Businesses are advised to monitor this development closely. Once implemented, it may significantly impact hiring decisions and early terminations.

Mutual termination in Belgium: a pragmatic solution or a legal minefield?
Mutual termination agreements are on the rise. Both employers and employees are increasingly opting for this “soft exit”, moving away from traditional notice periods and potential conflict. However, behind this apparent flexibility lie legal and financial complexities that are often underestimated.
A quiet trend in the Belgian labour market
In practice, HR departments and law firms are seeing a clear increase in mutual termination agreements. They are particularly common for white-collar profiles and in tight labour markets.
The logic is straightforward: it is often preferable to part ways quickly and discreetly rather than allowing a situation to drag on for months.
But simplicity can be misleading.
What does it actually involve?
In a mutual termination, both employer and employee agree to end the employment contract, without applying the standard rules on notice periods or termination indemnities.
There is no specific legal framework comparable to employer-driven dismissal. The terms are defined in a written agreement, often with legal support.
A key principle, according to the Belgian Federal Public Service Employment, is that consent must be freely given. Any form of pressure can invalidate the agreement.
Why companies are using it more often
For employers, the main drivers are speed and risk management.
- Avoiding lengthy and operationally disruptive notice periods
- Reducing the risk of legal disputes
- Handling sensitive situations discreetly
In cases such as underperformance without clear fault, small-scale reorganisations or a mismatch between role and profile, this approach provides a way out without escalation.
In SMEs, it is often seen as a pragmatic option: not a standard approach, but a way to prevent prolonged tension when a working relationship is no longer viable.
What about employees?
There are advantages, although they are less obvious.
- Faster availability for a new opportunity
- Room to negotiate specific conditions
- Reduced conflict and reputational impact
This option is particularly attractive for employees who already have another opportunity lined up.
The financial reality: where issues arise
No automatic protection
Unlike a standard dismissal:
- No automatic entitlement to notice compensation
- No statutory minimum guarantees
Everything depends on what is negotiated and agreed in writing.
In practice, organisations such as Group S and SD Worx observe that employees often underestimate what they give up when accepting such agreements.
Unemployment benefits: not straightforward
The Belgian unemployment office (ONEM/RVA) generally considers mutual termination as voluntary resignation.
This can lead to:
- Temporary suspension of benefits
- Investigation into the actual circumstances
Only if it can be demonstrated that the initiative effectively came from the employer may a sanction be avoided. This is not automatic.
Negotiation is key
A well-negotiated agreement can significantly reduce risks.
Typical elements include:
- A compensation payment (often aligned with notice compensation)
- Continued benefits (company car, phone, bonus) for a limited period
- Outplacement support
- Reference agreements
Labour law practitioners stress that this should never be treated as a mere formality.
Legal risks for employers
While it may appear straightforward, the approach also carries risks for employers.
- Potential disputes if implicit pressure is alleged
- Interpretation issues due to unclear clauses
- Reputational risks if exits are poorly managed
Specialised law firms emphasise the importance of properly documenting each agreement.
When is it the right choice?
In practice, mutual termination works best in three situations:
- A quick transition to a new job
- A shared understanding that the collaboration is no longer working
- A structured exit with fair compensation
It is less suitable when the employee depends on unemployment benefits or has limited negotiating power.
Conclusion: flexibility comes at a price
Mutual termination is not a shortcut, but a fully-fledged tool that requires maturity from both sides.
For employers, it offers speed and control.
For employees, it can create opportunities, but only if properly negotiated.
The bottom line?
What looks like a smooth and friendly exit must also stand on solid legal and financial ground. Otherwise, a soft exit can quickly turn into a hard landing.

First sick day back in focus: will guaranteed pay from day one be reconsidered?
The debate around the first day of sick leave is resurfacing in Belgium. Within policy circles and employer organisations, discussions are once again underway about revisiting guaranteed pay from day one of absence. For many SMEs, where short-term absences are immediately felt, this is far from a minor issue. But what is actually being considered, and what is already in place today?
A quick recap: what are the current rules?
Since January 2014, the so-called "waiting day" has been abolished. This brought a clear change:
- Employees are entitled to guaranteed pay from the first day of illness
- Even a one-day absence is therefore paid
- The rule applies to both blue-collar and white-collar workers
According to sources such as SD Worx and the Belgian federal authorities, the aim was to protect employees from income loss during short periods of illness.
Since November 2022, an additional measure has been introduced: employees may be absent for one day without a medical certificate up to three times per year. It is precisely this change that has reignited the debate around short-term absences.
Why is this back on the agenda?
Despite the reform, criticism has been growing, particularly from employers. Organisations such as the FEB and Unizo have pointed to an increase in short-term sick leave.
The reasoning is fairly straightforward:
if the first day of absence is always paid, it may lower the threshold for taking a single sick day.
SMEs tend to feel the impact most directly:
- More complex workforce planning
- Last-minute replacements
- Productivity loss in smaller teams
In smaller organisations, even a single absence can quickly disrupt operations.
What options are being discussed?
No final decision has been made at this stage, but several scenarios are currently being explored in policy discussions:
- Reintroducing an unpaid first sick day
- Limiting the number of paid short-term absences per year
- Increasing controls on medical certificates
- Introducing sector-specific rules
At the same time, recent changes regarding medical certificates are also feeding the debate. Employees can already take up to three one-day absences per year without providing a certificate, which adds another layer to the discussion.
What do the numbers show?
Data from HR service providers such as SD Worx and Partena Professional suggests that short-term sick leave has indeed increased in recent years.
Key patterns include:
- Absences lasting one to three days
- Peaks at the beginning and end of the week
- A stronger impact in physically demanding sectors
While the causes are not entirely clear-cut, the combination of more flexible rules and workplace pressure is often highlighted.
What does this mean for businesses today?
For now, no legislative changes have been approved. The current rules therefore remain fully applicable.
In practice:
- The first day of sick leave is still paid
- No immediate changes are required in payroll policies
- However, there is growing attention on absence management
As a result, more companies are investing in:
- Clear internal policies on sick leave
- Faster communication when absences occur
- Prevention and workplace well-being initiatives
A broader policy shift
The discussion around the first sick day is part of a wider trend in Belgian labour policy: increasing focus on activation and shared responsibility in cases of illness.
Alongside reintegration measures and follow-up processes, policymakers are also looking at:
- Faster monitoring of absenteeism
- Stronger collaboration with occupational health services
- Financial incentives for both employers and employees
The first sick day is just one piece of a larger puzzle.
Conclusion
The first day of sick leave remains paid for now, but the debate is clearly back on the table. Whether a reform will follow depends on political negotiations throughout 2026.
For businesses, the message is twofold: nothing changes immediately, but the issue is here to stay.
Those looking ahead would do well to review their absence policies now. Because if the rules shift again, the impact will be felt quickly on the ground.
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