A company car? Okay, but what if you don't want one?

Belgium has a long tradition of company cars. There are an estimated 500,000 people who have one across the country. It's a popular fringe benefit given by employers, considering the tax benefits. While most people are eager to accept this extra, others are not so keen and would prefer a different 'present' from their employer. So what happens if you don't want it? Are you offered an alternative? Our colleagues of the Dutch news desk Deredactie.be found three people willing to tell their story.

Here are the 3 personal stories:

-> "Mr X estimates that he deserves a pay rise and goes to his boss to negotiate. The boss understands his request and offers him a company car. Mr X politely rejects, because he doesn't really need a car, also because he lives close to his work. He'd rather have a wage increase, but that's not possible. It's the company car or nothing."

-> "Mrs Y's employer is very happy with her work and decides to offer her a company car. The lady normally takes the train to work and would prefer a rail pass for first class. Unfortunately, there is no alternative: it's a company car or nothing."

-> "Mr Z is working for a West-Flemish company and has to spend many hours on the road for his job. For that purpose, he was granted a company car. At a certain moment, he gets a regular job in Brussels. He prefers to take the train in Brugge station, and uses the company vehicle to drive to the station."

Counter traffic jams

The popularity of company cars seems to be never-ending. This hardly comes as a surprise: it's beneficial for both employers and employees from a fiscal point of view. At the same time, the coalition government is not even considering a different approach, leaving the company automobile the status of a sacred cow.

The right-wing parties in the federal government (Flemish nationalists of N-VA and Flemish and Francophone liberals of Open VLD and MR) swept a proposal supported by the Christian democrats of CD&V and the (opposition parties) socialists and greens off the table during the government formation. 

The opposition argued that the system of company cars is a major contributing factor to the eternal traffic jams in Belgium, and that the cash had better be used to stimulate public transport.

The stories above suggest that companies are not really flexible, but this has to be put into perspective. Businesses deny that they wouldn't be flexible and point to the system of "mobility budgets", under which they leave employees the choice (this will be highlighted in tomorrow's follow-up article). 

No major changes expected, unless...

It does not seem as if a major policy change can be expected for company cars. A political change is not expected in the next 4 years, while (most) private companies are only making slow mind changes. Figures show that the number of company cars on our roads is not going down. In order to trigger a real change in this respect, more drastic measures would be needed, critics argue. Wage costs for companies diminish under the present tax shift. This may inspire some to drop the company car as a way to compensate high tax rates.