The long-awaited reform of registration fees in Brussels, via a higher abatement, entered its final phase on Thursday. The draft ordinance carried by Sven Gatz (Open VLD), Brussels Minister of Finance, was on the government’s agenda for passage to third and final reading, where it received the green light from the ministers of the capital Region . It will establish a more advantageous regime for the purchaser.
The initial text had to be only slightly modified following its passage by the Council of State.
The project, which had consensus within the majority, will now be sent to Parliament to be debated and then voted on after the return to parliament. “We assume that the project will pass smoothly through Parliament”said Brussels Finance Minister Sven Gatz. “After all, the changes to the implementation of the abatement are part of the Majority Agreement. We expect the new regulations to come into effect on April 1, 2023.”
The tax allowance goes from 175,000 euros to 200,000 euros
The date of signature of the sales agreement will be decisive for benefiting from the new system, and not the execution of the deed or its registration. Each year, more than 7,000 households, i.e. more than half of buyers, benefit from the allowance in the Brussels-Capital Region (7,086 with allowance in 2021, 6,740 without).
The new system will modify the current one in three key points.
On the one hand, the government is passing the reduction from 175,000 euros to 200,000 euros. The purchaser will therefore be exempt from registration fees up to 200,000 euros: beyond that, they will remain fixed at 12.5%. For example, for a house worth 400,000 euros, the buyer will pay 3,125 euros less than under the current system.
Buyers can leave their home more easily within five years after acquisition. Reimbursement will no longer have to be full, but paid in proportion to the number of years they have occupied the property.
An additional allowance of 50,000 euros is added in the event of substantial energy renovation of housing. Owners must commit to raising their home two levels on the PEB scale. The buyer who buys a home at 590,000 euros can thus benefit from an additional rebate of 6,250 euros on his registration fees.
An incentive to renovate
This incentive to renovate is part of the same logic as the socialist proposal aimed at prohibiting the indexation of rents for energy strainers.
Finally, the current ceiling for benefiting from an abatement will be increased, from from 500,000 to 600,000 euros.
The allowance (on the first 100,000 euros instead of 87,000 euros) and the ceiling (from 250,000 to 300,000 euros) to benefit from it will also be increased for buying a building plot to respond to a reservation issued by the Council of State. This was not planned in the initial project. This change is relatively anecdotal, given the very low number of plots sold each year in the capital.
The aim of the reform is to improve access to property for a public of more precarious tenants, but also to attract people with higher incomes to somewhat pull the finances of Brussels out of their slump.
It is also a question of making up for the deficit with Flanders in tax competition between Regions. The reform will not be enough since the new system remains much less advantageous than the Flemish model, with registration fees set at 3%.