BELGIAN BOURSE TAX MOVE BLOCKED IN CABINET
Finance Ministry proposals for
abolishing bourse transaction taxes for non-residents have been
blocked in cabinet and will not be re-submitted for several
weeks, a Finance Ministry spokesman said.
    Government sources said the blockage would also delay an
announcement of measures that would simplify the procedure for
non-residents to recoup the 25 pct withholding tax levied on
investment income in Belgium.
    Finance Minister Mark Eyskens told Reuters yesterday that
he hoped the cabinet would approve the bourse transaction tax
proposals today.
    Eyskens also said he would in the next few days announce
plans to simplify and eventually stop the procedure for foreign
investors to reclaim witholding tax.
    Financial analysts said the current procedure is so slow
that it effectively acts as a barrier to foreign investment in
Belgium, especially in the bond market.
    They said the move to simplify it would be far more
significant than the abolition for non-residents of the bourse
transaction taxes. These are set at three rates -- 0.07 pct,
0.14 pct and 0.35 pct -- according to the security transacted.
    Government sources said abolition of the bourse taxes for
foreign investors had been held up by concern in the cabinet
over the budgetary impact of the move, put by the ministry
spokesman at 125 mln francs a year.
    The sources said it was likely that this proposal and plans
to simplify the witholding tax procedure would now be submitted
together to the cabinet in several weeks.
    Eyskens said abolition of the transaction taxes for
non-residents would make Brussels one of the few stock
exchanges in the world where foreign investors were not
subjected to such a tax.
 REUTER
