Summary of CO² Taxes Applied When Purchasing a Car

In order to encourage individuals and businesses to purchase cars that emit less CO₂ into the atmosphere, our different regions continue their incentive policy. Summary of CO₂ taxes. Wallonia offers an eco-bonus or eco-malus depending on the car’s CO₂ emissions, while the registration tax (TMC) in Flanders is calculated based on CO₂ emissions, the fuel used, and the car’s Euro standard.

Definition and scope of the CO₂ tax

The CO₂ tax is a tax that every employer must pay for each vehicle made available to an employee for non-professional use. This contribution is 100% deductible and must be paid by the employer to the National Social Security Office (ONSS) in the same way as social contributions for their employees. Self-employed individuals, company directors, and liberal professions are not affected by this CO₂ tax. It applies to cars, minibuses, mixed-use vehicles, and utility vehicles owned by companies.

How is this CO₂ tax calculated?

The CO₂ tax is flat-rate and closely depends on the type of fuel used as well as the car’s CO₂ emissions. If this latter data is not known, it is set at 165 g/km for diesel engines and 182 g/km for gasoline engines. The calculation of this CO₂ tax uses quite complex formulas that must be well understood to avoid errors when paying it. An unpaid CO₂ tax results in a penalty set at double the tax plus a 10% surcharge, to which 7% annual interest is added.

How to avoid the CO₂ tax?

It is up to the employer to prove that the CO₂ tax cannot be applied to their vehicles because they are not used for private purposes. This is the case for cars that return to the company’s depot or garage each evening. This exception also applies to the worker who uses the car as an independent manager or if they are under a PFI contract.