12:15 07-04-2026

Belgium plans new tax on company cars, affecting Audi, BMW, Mercedes

Belgium is considering a tax on company cars from 2027, targeting luxury options like premium audio and massage seats. This could reshape Europe's corporate car market and impact electric vehicles.

Belgium is considering a new tax on company cars starting in 2027, which would affect models from Audi, BMW, and Mercedes, including electric vehicles. This additional charge would target "excessive" options—from premium audio systems to massage seats—potentially reshaping Europe's corporate car market.

While Europe is actively transitioning corporate fleets to electric power, Belgium has identified an unintended consequence. Companies are increasingly leasing or renting expensive vehicles to take advantage of tax benefits.

As a result, the country's budget is missing out on significant revenue, estimated at least €2 billion. Authorities now aim to revise the system by distinguishing between work vehicles and what they see as "premium perks" for employees.

The proposed "luxury index" would account for a car's equipment. Items like large wheels, high-end audio systems, ambient lighting, premium materials, and other comfort features could face additional taxation.

In contrast, basic functions such as cameras or heated seats might remain exempt, as they are considered essential for operation.

The main risk is that leasing or renting expensive cars could become less attractive. Monthly payments for customers could rise noticeably, prompting a shift toward more affordable models.

For premium brands, this poses a significant challenge, since corporate sales make up a substantial portion of their European business. If Belgium implements this initiative, the company car market could change dramatically. Premium models would lose some of their appeal, and a trend toward "moderate" and functional vehicles might spread across Europe.