The Federal 2025 Coalition Agreement: What does it mean?

On Friday, January 31st, a new Belgian federal coalition was formed, known as the Arizona Coalition. This coalition has reached a consensus on a common vision and priorities up to 2029. While the exact content and timing of this agreement are still to be defined, several key points related to mobility have already been announced, which could significantly impact both businesses and employees. Below is an overview of the most important changes.

Extension of the transition period for plug-in hybrid vehicles

One of the most notable points in the new agreement is the reduction of the fiscal deductibility of plug-in hybrid electric vehicles (PHEVs). Before the implementation of the agreement, PHEVs’ 100% fiscal deductibility, decreases with 25% per year as of 2024. Due to the new agreement, PHEVs ordered before 2028 remain maximally 75% deductible. For vehicles ordered in 2028, the deductibility is maximum 65%, and for those ordered in 2029 it is 57.5%.

Important exception

There is an important exception for PHEV cars with CO2 emissions of less than 50g/km. If the calculation"120% - (0,5% x [coefficient] x CO2)" results in a score higher than 75%, the car remains up to 100% deductible until the end of 2027.

Additional impacts on PHEV fiscality

• CO2 contribution: The contribution used is the same as that for a fully electric car.
• Fuel costs: They will remain maximally 50% deductible, while electricity costs remain 100% deductible.
• Benefits in Kind (BIK): The calculations remain the same. However, generally, higher CO2 emissions result in a higher BIK.

Keep in mind the implementation of the Euro Standard 6e bis in 2025. Newly produced PHEVs will need to comply with a new testing standard, likely resulting in a higher estimated CO2 emission of 50g/km or more. Therefore, they fall within the maximum deductibility described above, and the BIK for the driver will significantly increase. Read more about the Euro Standard 6e bis.

 

Mobility budget becomes compulsory and available to all employees

Change 1: Obligatory offer of mobility budget to employees entitled to a company car

Before the agreement, companies had the option to offer the Mobility Budget to employees entitled to a company car. With the implementation of the agreement, companies will be required to offer the Mobility Budget to these employees. Employees can still choose whether to use the Mobility Budget or not.

Change 2: The mobility budget for all employees

The second change concerns the vision of the Mobility Budget: over time, the Mobility Budget should become "available to all." This means it will no longer be solely for employees entitled to a company car but will be offered to all employees. 

Exact details regarding timing and scope have not yet been shared, but transitional measures will be considered to give companies time to implement the Mobility Budget.

Discover how Alphabet can help you implement the Mobility Budget with expert advice and user-friendly tools. Learn more.

 

Other changes

Social leasing of electric cars

Social leasing allows employees with insufficient income to lease an electric car. The government will explore mechanisms to support the social leasing of electric vehicles, targeting employees with an income below a certain threshold.

Incentivizing the purchase and use of electric light commercial vehicles and trucks

Since electric variants of light commercial vehicles and trucks are considered too expensive compared to their fuel alternatives, the government will continue to financially incentivize the purchase and use of these electric variants.

Incentivizing carpooling to work

The government will research the fiscal deductibility of carpooling to work so that all employees can benefit from carpooling.

 

Conclusion

The Federal Coalition Agreement 2025 brings several significant changes that will impact both businesses and employees. From the reduction of fiscal deductibility of PHEVs to the compulsory introduction of the Mobility Budget for all employees, these measures aim to promote sustainability and mobility.

Coalition Agreement: content, timing and scope are subject to change.