The City of Leuven has reached its financing limits and is increasing taxes for businesses on its territory by a whopping 17%.
We have just written an article about the new surface tax on commercial real estate in the Tienen, and Leuven is also increasing the property tax on commercial real estate.
The City of Leuven has presented its multi-year plan for 2026–2031, announcing an investment programme totalling €426 million. Notably, the city indicates it has limited financing capacity left and therefore opts for a substantial tax increase on commercial real estate: the municipal surcharges rise from 975 to 1,170, an increase of no less than 17%.
In practical terms, this means that on the regional base tax per €100, the municipal surcharge of €9.75 will rise significantly for business properties. While the rate for most properties remains unchanged, Leuven is now introducing differentiation: commercial buildings and parcels will be taxed at 1,170 surcharge points. Additionally, taxes on vacant buildings, undeveloped land and second residences will also increase.
The separate business tax that, according to the City of Leuven, will
not be introduced ultimately amounts to a straightforward tax increase
that will be passed on to all companies in Leuven. Because property tax on commercial real estate is typically passed on to tenants, the measure does not only affect property owners. Many companies renting space in Leuven will also face higher costs — a significant concern in an already challenging economic environment. As a result, a large share of companies operating in Leuven — even when they are not the owners of their premises — will bear the increased tax burden. For many businesses, this decision therefore represents an additional cost increase in an already challenging economic climate.
City officials frame this as a “fair contribution from companies”, meant
to support planned investments. However, most of these investments
focus on broad civic amenities — infrastructure renewal, social housing,
bicycle parking facilities, elderly care, education support, heritage
restoration and sports infrastructure — developments that generally do
not provide direct benefit to businesses. Not sure if you can call these
"investments" either? They sound more like basic services any major
city should be providing?
So, the real question is of course why a city as Leuven is no longer able to provide the aforementioned basic services without raising taxes significantly. What has changed?
Sources:
Verhoogde belasting voor Leuvense bedrijven "valt bijzonder zwaaar"
Werkgeversorganisatie VOKA niet te spreken over belastingverhoging: "Leuvense bedrijven zullen samen 20 miljoen euro meer moeten betalen"