Belgium: abolition of Belgian bank secrecy compatible with Belgian Constitution

April 30, 2013

On 18 April 2013, the Belgian Constitutional Court (Cour Constitutionelle/Grondwettelijk Hof) gave its decision on the petition of the vzw Liga van Belastingplichtigen of 11 June 2012 arguing that the surcharge on investment income and the related reporting measures are incompatible with articles 10 and 11 (non-discrimination), article 22 (right to respect private life) and 29 (mail confidentiality) of the Belgian Constitution and article 8 (right to respect private life) of the European Convention on Human Rights.

Details of the case are summarized below.


The petition concerned the compatibility of the temporary introduction in 2012 of a 4% surcharge levied on dividends and interest exceeding a threshold of €20,020 and the related reporting obligations with the right to respect private life of article 22 of the Belgian Constitution.

The surcharge is abolished from 2013, due to the introduction of a general withholding tax of 25% on dividends and interest for most cases.

Legal background

In 2012, a 4% surcharge was levied on dividends and interest exceeding a threshold of €20,020.

The taxable base generally included all dividends and interest. Excluded from the taxable base were:

  • Dividends and interest taxed at 10% or 25%
  • The first €1,830 of interest income derived from ordinary savings accounts and interest derived from Belgian state bonds

Taxpayers had the following options:

  • To have the surcharge of 4% withheld at the source with the possibility of reclaiming the excess amount withheld in their tax returns
  • To declare all interest and dividend income in their tax returns and have the surcharge added to the tax due in their global assessment

In order to safeguard the correct collection, it was intended to create a “Central Contact Point” with the National Bank of Belgium to which the banks are obliged to communicate the names, accounts and contract numbers of their clients


First, the Court observed that the measure concerned infringes the right to respect private life. However, the infringement is justified because it was necessary to assure the correct collection of the 4% surcharge introduced to solve budgetary problems.

In addition, the Court held that the measure was not disproportionate. In this context, the Court was decisive that only investment income and the identity of their beneficiaries was sent to the Central Contact Point.

Neither bank transfers between the beneficiary of investment income and third persons, nor exchange data between the debtor of the withholding tax and the clients, were made available. In addition, the exchange data did not concern the source of the funds of the beneficiary of the investment income or the payment date and the related notifications.

Furthermore, the Court considered that the tax administration could not obtain the identity of the debtor of the withholding tax, but only data concerning taxpayers who did not opt for withholding at source.

The Court also regarded as a substantial procedural guarantee that the data should not be sent to the tax administration directly but to a separate government institution.

Therefore, the Court held that the infringement on the right to respect private life was not disproportionate because the obligation to provide information and the data involved was restricted, and there were sufficient procedural guarantees with respect to the notification of the data.

Finally, the Court held that the contested measure was also not incompatible with the non-discrimination principle, because the different treatment arose from a justifiable infringement of the right to respect private life.

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