Belgium Granted Nearly €15 Billion in Fossil Fuel Subsidies in 2024
Belgium granted nearly €15 billion in fossil fuel subsidies in 2024, according to the fifth edition of the Federal Inventory of Fossil Fuel Subsidies published on July 2 by the SPF Finances and the Climate Change Service of the SPF Public Health. The figure — which includes direct subsidies, indirect support, international transport exemptions, and the company car tax regime — has drawn sharp criticism from environmental groups who argue the country is failing to match its climate rhetoric with fiscal reality.
Context: A Contradiction Between Ambition and Action
The report, compiled annually since Belgium committed to the practice at COP26 in Glasgow in 2021, reveals that direct subsidies across all sectors of the Belgian economy amounted to €10.78 billion, or 1.7% of GDP. These subsidies primarily take the form of tax exemptions, reduced excise duties, and lower VAT rates. While this represents a decline from 2.4% of GDP in 2021, the Federal Public Service Finance notes that the decrease is largely due to cyclical factors — lower natural gas consumption and falling energy prices — rather than structural policy changes.
As the Climat.be official press release states: “The progressive elimination of fossil fuel subsidies is essential for a successful climate transition. These subsidies send incorrect price signals and hinder the adoption of sustainable solutions, such as heat pumps or the electrification of the transport sector.”
Key Developments: Where the Money Goes
The transport sector received the largest share of subsidies in 2024, totaling €6.36 billion. This includes €1.99 billion in direct aid, nearly all indirect subsidies (€224.5 million), €1 billion in international transport subsidies, and the €3.1 billion company car tax regime — which has been rising continuously since 2020.
The building sector ranks second with €4.65 billion in subsidies, representing 43.2% of all direct subsidies, while industry ranks third with €3.15 billion, or 29.3% of direct subsidies.
International transport subsidies — separated due to their cross-border nature — reached €1.006 billion in 2024. The kerosene exemption for aviation alone was estimated at €754.6 million, rising steadily since 2020. Heavy fuel oil and diesel exemptions for maritime transport accounted for €226.9 million and €24.9 million respectively.
Indirect subsidies, which favor the consumption of goods or services involving fossil fuels, represented €225 million in 2024, primarily driven by VAT exemption on airline tickets.
Analysis: A Slight Decline, But No Structural Reform
While total direct subsidies fell from €11.7 billion in 2023 to €10.8 billion in 2024 — an 8% decline — the RTBF reports that this was mainly due to the phasing out of temporary crisis measures adopted during the 2022 energy crisis, lower energy prices, and reduced natural gas consumption. The underlying structure of subsidy support remains largely unchanged.
Subsidies in the form of social transfers to individuals amounted to €120.2 million in 2024, down from a peak in 2022-2023 when the expanded social tariff was in effect.
Charlotte Chapotel, writing for L’Avenir, captured the tension succinctly: “Belgium claims to share this ambition. Yet the country continues to support these energies with billions of euros in subsidies.”
European Pressure Mounts
The European Commission has repeatedly called on Belgium to phase out fossil fuel subsidies. On June 3, 2026, the Commission published its country-specific recommendations, again urging Belgium to take concrete measures, particularly in the transport and heating sectors.
The OECD and the European Union have both invited Belgium to reduce its subsidies, and the government agreement of the De Wever coalition (2025-2029) commits to examining “which fossil fuel subsidies can be reduced and within what realistic timeframe this gradual phase-out can be implemented.”
Globally, the challenge is immense. According to the IMF, worldwide fossil fuel subsidies reached $7,430 billion in 2024.
What’s Next: The Spending Review
For the first time, this year’s inventory has led to a “spending review” for the Belgian government, which will analyze each subsidy individually and propose several scenarios for reduction by 2030. The results are expected in autumn 2026 and will be a critical test of the government’s willingness to translate commitments into action.
Several factors will shape the outcome. The EU ETS2, which will apply a CO₂ price to buildings and transport starting in 2027, could make some subsidies redundant. The government is also developing a Social Climate Plan to accompany the transition.
However, the path forward is fraught with tension. Many subsidies serve legitimate social purposes — supporting vulnerable households and maintaining business competitiveness. Removing them without compensatory measures could harm those they were designed to protect. As the inventory itself notes, subsidy amounts should not be considered as potential budget revenue, since removing subsidies would change behavior and consumption patterns.
Conclusion: A Defining Moment for Belgian Climate Policy
Belgium’s fifth fossil fuel subsidy inventory paints a clear picture: despite international commitments and a slight cyclical decline, the country continues to pour billions into supporting the very energy sources driving climate change. The autumn 2026 spending review will reveal whether the government has the political will to pursue structural reform — or whether the gap between climate ambition and fiscal reality will persist.
With the EU ETS2 on the horizon and mounting pressure from Brussels, environmental NGOs, and international climate commitments, Belgium faces a defining moment in its energy transition. The question is no longer whether fossil fuel subsidies should be phased out, but when — and at what social and economic cost.