Belgium agrees budget with tax on energy companies, ministers' salary cuts

By Marine Strauss and Charlotte Van Campenhout

BRUSSELS (Reuters) -Belgium's federal government reached a deal on the annual national budget on Tuesday, including cuts to ministers' salaries, measures to support families and companies and a tax on the profits of energy companies such as Engie and TotalEnergies.

Belgian Prime Minister Alexander De Croo also said the government decided to extend the lifespan of the youngest nuclear power plants with the country looking to increase its energy capacity.

"Just as we did during the COVID crisis, we will not abandon anyone, to do nothing today would be a form of guilty negligence," De Croo told Belgian lawmakers.

"When the skies have cleared and the storm has died down, the house should be in order again ... With a net effort of 0.6% of the GDP, or 3.6 billion euros, that will bring the federal government to a structural deficit of 3.2% of GDP in 2024," he said.

The tax on profits made by energy companies over 180 euros per MW/h should bring in 3.1 billion euros ($3.01 billion) from January until June 2023, in line with EU recommendations.

Belgium already earns around 800 million euros ($804 million) from a nuclear tax that it will extend to fossil fuels companies and electricity producers.

The nation of 11 million is a natural gas hub, with around 10% of total Russian LNG (liquefied natural gas) exports using trans-shipment services at the port of Zeebrugge. In cold weather, underground gas storage capacity of 9 TWh is also available at Loenhout, near Antwerp.

Belgian ministers will see their own salaries trimmed by eight percent in the upcoming budget year, and a temporary tax of 15% for multinationals with a profit of more than 1 million euros will also be introduced.

The government will seek to decrease the price of healthy food and making unhealthy products more expensive, with no VAT on fruits and vegetables from 2023 and excise taxes on tobacco and vapes increased.

And with Russia's invasion of Ukraine, the government will make proposals to grow the defence budget to 2% of GDP in 2035 and will not reintroduce general conscription.

($1 = 1.0297 euros)

(Reporting by Charlotte Van Campenhout, Marine Strauss, Editing by William Maclean and David Evans)