Prosperity – Taxes
Nearly €5billion of taxes go into the state budget
Sources: National Bank of Belgium, National Accounts Institute, National Social Security Office
NB: blue: employees contribution; orange: employers contribution
The chemicals, plastics and life sciences sector makes a significant contribution to national, regional and local authority budgets through the taxes it pays. To give a balanced picture of the sector’s contribution, benefits from subsidies and tax incentives are also taken into account.
In 2015, companies and employees in the chemicals, plastics and life sciences industry contributed almost €5 billion to the state budget net of subsidies and tax incentives, equivalent to 30% of the sector’s value added in 2015.
The main contribution comes from companies’ social security contributions (€1.9 billion in 2015). These help to finance the social security system, and account for almost 40% of the sector’s total net contribution to the state.
The sector’s 90,000 workers also contribute to the state budget through their individual social security contributions (€695 million in 2015) and personal income taxes (an estimated €1.4 billion in 2015).
Corporate taxes are also an important source of state financing and the sector paid €932 million in 2015. Corporate taxes on profit amounted to more than €1 billion after tax incentives, with the balance accounted for by environmental, property and other taxes on production activities (€154 million in 2015). Pharmaceutical distributors in Belgium also pay an annual tax on the sale of pharmaceutical products on the Belgium market (€218 million in 2015).
In addition, the sector contributes indirectly to the state budget through the indirect taxes and additional levies it pays. For example, as an intensive energy consumer, the industry pays significant taxes on energy through its electricity bill, such as the federal levies on electricity and gas, and increasing additional levies linked to renewable energy. (However, in the absence of consolidated official public data, these sums have not been taken into account.)
On the other hand, the sector received tax incentives on wages and subsidies, particularly related to R&D and shift work, worth an estimated €513 million in 2015. These incentives are crucial to maintain and enhance the competitiveness of the chemicals, plastics and life sciences industry in Belgium.
Overall, every employee in the chemicals, plastics and life sciences industry contributes €55,486 to the state budget compared with €41,647 for the manufacturing industry as a whole.