Slow start for mobility budget and ‘cash for car’
Belgian tax-efficient alternatives to the company car, like the mobility budget, and ‘cash for car’, are not catching on yet. Only 0,011 percent of the employees eligible for the mobility budget opted for it. ‘Cash for car’ could only convince 0,175% of the 210.000 company car drivers surveyed by Acerta.
‘Cash for car’ and the mobility budget are two different options for employees to replace their company car. The federal government introduced ‘cash for car’ in early 2018. It allows employees to exchange their vehicle for a monthly net amount of 700 euros.
In 2018, only 0,065 percent of company car drivers exchanged their car for a cash sum. At the end of 2019, that number slightly increased to 0,175 %. Acerta does not believe that ‘cash for car’ will be truly successful as the employee’s need for mobility will remain.
The Federal government introduced the mobility budget scheme in April 2019. It provides for the possibility to exchange a company car for a less polluting one, supplemented with mobility alternatives and a piece of extra net pay.
Flemish newspaper De Morgen requested figures from major HR service providers. They show that the success of the mobility budget is limited. Among SD Worx clients, barely 15 employees have opted for the mobility budget since April. Acerta registered four people who joined the system. The official government figures for 2019 will only be available in July.
Not dead yet
Nevertheless, there is still hope that the mobility budget will convince more people in the coming years. Employers are showing interest, according to previous surveys by SD Worx and Acerta. But that will take time. After all, if you already have a company car, you will first have to take out your lease contract. “And some employees are still in doubt,” says Annelies Baelus of Acerta Consult.
Baleus also points out that today there are only a few mid-range electric cars available. Moreover, it is often impossible to finance them with the mobility budget available to the employee. However, Acerta is convinced that the mobility budget will become more successful in the coming years if the obstacles are solved.
“The figure is low, we can’t ignore that,” says Veerle Michiels, mobility expert at SD Worx in ‘De Morgen’. She feels the relative unfamiliarity and complexity are playing tricks on the system. “The possible alternatives can be broadly defined: you can also recover part of your loan, for example, if you live within a radius of 5 kilometers of your work. It gives an extra administrative burden, but we advise companies to start with a basic package and build on it later,” Michiels says.
For Federal minister Maggie De Block (Open Vld), it is too early to draw any major conclusions. “Employers and leasing companies need time to adjust.”
Federal Members of Parliament Jef Van den Bergh (CD&V) and Egbert Lachaert (Open Vld) put the theme on the political agenda. They remain strong supporters, although they are open to improvements. “In the coming period, we will have to evaluate this system in parliament,” says Van den Bergh.
Open Vld advocates extending the mobility budget in the long term to all employees, not just to those who already have a company car.