Budget Revenues

The Sixth State Reform, which entered into force on 1 July 2014, brought about substantial changes to the Flemish budget landscape.

First and foremost, the size of the Flemish budget has grown significantly. Flemish resources rose from 27.45 billion euro in 2014 to 44.76 billion euro in the 2020 - budget revision, an increase of no less than 63%.

Due to the covid-19 crisis there is a one-off effect of 727 million euro on the revenues mainly due to a decrease of the registration tax.

If there would already be an adjustment of the SFA grants in 2020, with the recent economic forecasts of the Federal Planning Bureau, the revenues would decline by another 2.1 billion euro.

In addition to major transfers of powers and resources from the federal level, the Sixth State Reform also provided for a large increase in Flemish tax autonomy. From now on, Flanders collects a larger part of its resources (30.3%) via its own fiscal instruments: regional taxes (12.8%), and the additional personal income tax charge, the so-called 'surcharges' (17.5%).

Another consequence of the Sixth State Reform is that it ensures that the sub-regions now contribute to the recovery of public finances at general government level. For Flanders, this (annual) contribution amounts to 1.6 billion euro up until 2018, of which the major part concerns the two first years after the reform (750 million euro in the both the 2015 and the 2016 budget).