Belgium Raises Gas and Heating Oil Excise Duties, Cutting Electricity Taxes in Parallel

Belgian households are facing higher energy bills as of August 1, when the federal government’s long-planned increase in excise duties on natural gas and heating oil took effect. The tax adjustment, part of the De Wever government’s multi-year budget agreement, is being partially offset by a simultaneous reduction in excise duties on electricity.

Why the Change Was Made

The reform stems from a binding EU directive requiring member states to exclude fossil fuels from fiscal advantages. During the energy crisis that followed Russia’s invasion of Ukraine, Belgium reduced the VAT rate on natural gas from 21 percent to 6 percent as a crisis measure. After several extensions, the reduced rate became permanent. However, from January 1, 2030, EU rules mandate the standard 21 percent VAT rate for fossil fuels.

Rather than implementing a sudden price shock in 2030, the federal government chose a gradual approach: increasing excise duties progressively from now until 2030, then raising VAT to 21 percent while reducing excise duties again. As VRT NWS explained, the government saw this as “two birds with one stone”: easing the transition to 21 percent VAT while generating hundreds of millions of euros for the federal budget.

What It Costs Households

For an average family consuming 17,000 kWh of gas annually, the gradual excise duty increase will add approximately 77 euros per year by 2029. The increase is being phased in gradually, starting today and completing by 2029.

According to Selectra, an average household faces annual increases of about 75 euros for natural gas and 15 euros for heating oil, while electricity costs drop by roughly 34 euros per year. For the average Flemish family using 17,000 kWh of gas and 3,500 kWh of electricity, the net effect is about 35 euros more per year.

The fiscal administration’s earlier estimates, reported by VRT NWS, projected a net increase of approximately 7 euros for an average family of four in 2026, factoring in the electricity excise reduction.

A Delayed Implementation

The excise duty increase was originally scheduled for April 1, 2026, but was postponed to August 1 due to the war between Iran and the United States, which sent energy prices soaring. The delay also resulted from opposition parties blocking the programmawet with amendments and requests for advice from the Council of State, as VRT NWS reported at the time.

The Belgian Chamber of Representatives ultimately approved the programmawet on May 29, 2026, after months of parliamentary maneuvering. Business AM confirmed the approval alongside other significant legislative measures.

Winners and Losers

The reform has drawn criticism from opposition parties who argue it hits households during an energy crisis. PVDA leader Sofie Merckx called the government’s position “hypocritical,” noting that families face higher taxes on top of price increases driven by the Iran conflict. Opposition party Anders dismissed the measure as a “sham” tax shift, arguing there is no real rebalancing as long as electricity savings don’t fully offset gas increases.

Energy expert Ruben Baetens of KU Leuven offered a more measured assessment: “All beginnings are difficult, but it is a beginning.” He calculated that for an average Flemish household, the electricity bill decreases by 34 euros while the natural gas bill increases by 45 euros.

The clear winners of this reform are households that already heat electrically, such as those with heat pumps. As VRT NWS noted, those who could afford expensive heat pumps and solar panels benefit most from the electricity excise reduction, while the gas increase passes them by entirely.

Looking Ahead

The excise duty increases on natural gas and heating oil will continue to phase in through 2029, generating an estimated 393 million euros in additional federal revenue, while residential electricity excise duties will decrease by 170 million euros. From 2027, excise duties on diesel and gasoline are also scheduled to rise.

By January 1, 2030, the VAT on natural gas will jump from 6 percent to 21 percent as required by EU rules, at which point excise duties will be reduced again. For Belgian households, the energy tax landscape will continue to evolve significantly over the coming years as the country navigates its energy transition under both domestic fiscal pressures and European regulatory requirements.