Belgium has received approval from the European Commission (EC) to prolong its existing tax measures for maritime transport until the end of 2022.
The approval was granted under EU state aid rules, which encourage shipping companies to register vessels in Europe to ensure higher social, environmental, and safety standards.
Belgium expects to include a number of changes to prevent discrimination between both individual shipping companies and different European Economic Areas (EEA).
According to the amended scheme, a company will be taxed based on its ship tonnage or the size of its shipping fleet, rather than its profits. This ensures that tonnage taxation will be applied to a shipping company’s core revenues derived from different shipping activities including cargo and passenger transport.
Tonnage taxation will also include certain ancillary revenues closely related to shipping activities, which are currently capped at a maximum of 50% of a ship’s operating revenues.
It will also be applied to revenues from towage and dredging, in addition to onshore ship management activities.
The Belgian scheme mandates a shipping company to operate a significant part of its fleet under the flag of an EU or EEA State.
According to EC, the scheme will provide incentives to maintain maritime jobs within the EU.