Belgian tax incentives for giving increased to offset Covid impact on charity income

Successful lobbying in Belgium means that tax incentives for individual charitable giving have been increased for this year to help offset the impact of the corona crisis on charities’ income. 

The VEF-AERF (the Association for Ethics in Fundraising in Belgium) lobbied for the temporary change earlier in 2020 in response to the pandemic impact on the country’s not for profit organisations. The association’s 130 members together receive more than 60% of charitable donations in Belgium. 

In normal circumstances, charitable donors in Belgium benefit from a tax reduction of 45% of the value of gifts given over the course of the year, up to a ceiling of 10% of the individual’s net taxable income. Under the changes however, which were approved this Summer, the tax reduction has risen to 60% of the value of gifts given in 2020, up to a ceiling of 20% of net taxable income. 

The measure applies to donations made to all recognised nonprofit institutions from 1 January to 31 December, and is expected to reduce tax income of Belgian Government by around €28 million.

Geert Robberechts, VEF-AERF secretary, commented:

“The nonprofit sector has suffered greatly due to the corona crisis with street and door-to-door fundraising suspended, along with all events. 

“We hope that the publicity around this measure will act as a wake up call for the public and remind them not to forget charities during these difficult times, and that the tax incentive increase to 60% will act as a further incentive to give. We are aware that the income it generates won’t replace the countless suspended public fundraising activities, but it will surely be a support.”

The VEF-AERF is now calling nonprofit organisations across the country to communicate the change and its benefit to the public as much as possible to further encourage generosity over the coming months. The association is also calling for the increase to be extended into 2021.