Wallonia Unveils 3-Year Budget With Job Bonus, Tax Cuts

The Walloon government presented its budget on Monday, unveiling a job bonus for workers, a major reform of inheritance taxes, and a decision to leave child benefits untouched - all within a three-year fiscal trajectory described as the first in the region’s history. Minister-President Adrien Dolimont (MR) announced the measures at a press conference in Namur, setting the region on a path toward budget equilibrium by 2029.

“For the first time in the history of Wallonia,” Dolimont said, the budget is spread over three years - a “structured and readable” trajectory through the end of the legislature that “should surprise more than one,” according to RTBF. The agreement was reached on Sunday and formally presented Monday morning, as the cabinet confirmed to RTBF ahead of the announcement.

A Job Bonus Broader Than Flanders’

The centerpiece of the budget is a new annual “job bonus” of 205 million euros aimed at boosting employment and purchasing power. Starting in 2028, workers earning up to 5,000 euros gross per month will receive an annual payment. The lowest earners can receive up to 500 euros per year, with the amount tapering to 50 euros for those at the 5,000-euro threshold. A 100% federal tax exemption would be possible.

According to VRT NWS, the Walloon measure is significantly broader than the existing Flemish job bonus, which applies to wages up to roughly 3,000 euros gross per month. Walloon minister Pierre-Yves Jeholet (MR) said the bonus would “strengthen the purchasing power of workers.”

Flanders has long debated its own version of the measure. As VRT NWS reported in 2025, the Flemish job bonus costs around 250 million euros annually and has been the subject of recurring budget controversies.

Overhauling a “Very Unfair” Inheritance Tax

From 1 January 2028, the first 75,000 euros of an inheritance in the direct line - from parent to child - will be exempt from tax. Only amounts above that threshold will be taxed at current rates. The result, Dolimont said, is that 62% of direct-line successions will be exempt, up from less than 25% today. For other categories of heirs, the maximum rate drops from 80% to 50%.

“There will be no inheritance tax above 50%,” Dolimont said. He has repeatedly described the tax as “very unfair,” telling RTBF in September that it was “clearly a reform that is important for the whole government.”

The property gift-tax reduction, voted at the end of 2024 and scheduled to take effect on 1 January 2028, is maintained. The reform reflects a flagship commitment of the liberal MR, which leads the Walloon coalition alongside the centrist Les Engages.

Child Benefits Untouched - A Deliberate Contrast

Families minister Yves Coppieters (Les Engages) emphasized that the “Walloon family model” is preserved. The base allowance is maintained, indexation is kept, and the various social supplements - for handicap, single parenthood, and large families - remain in place. The universal right is maintained until age 25, along with birth, adoption, and school-start premiums.

The decision stands in deliberate contrast to Flanders, which plans to save 137 million euros on child benefits next year. The juxtaposition serves as a political marker for the Dolimont government, distinguishing its approach from the fiscal tightening being pursued north of the language border.

Vignette Pays for Traffic Tax Cut, Infrastructure

The budget pairs a reduction in the annual traffic tax - especially for small and electric cars - with the introduction of a road vignette, similar to systems in Flanders and Brussels. The vignette will cost 90 euros per year for electric cars, 100 euros for Euro 4 and higher vehicles, and 125 euros for Euro 0 to Euro 3 vehicles. It applies to Belgians and foreigners alike.

Infrastructure minister Francois Desquesnes (Les Engages) noted that the vignette cost is “lower than the reduction in the traffic tax and the job bonus that is built in.” Dolimont framed the vignette as a way to raise revenue without burdening citizens: “We want to capture new revenue, but without impacting our citizens. Simply making everyone pay for the use of the network,” he told RTBF in September.

The vignette helps finance a 3.5-billion-euro infrastructure plan over seven years for roads, bridges, and waterways - including 504 million euros for bridges and 442 million for hydraulic ways. The SOFICO structuring network will expand by 100 km in summer 2027 and up to 500 km more in January 2028. The plan is also partly financed by a kilometre-charge for heavy goods vehicles over 3.5 tonnes.

Energy, AI, and Savings

The budget allocates 180 million euros for indirect carbon cost compensation, 90 million for a new European support mechanism, and 10 million for white hydrogen research. For its 2050 energy strategy, the government retains two scenarios involving 3 and 4 gigawatts of nuclear capacity, with the choice conditional on federal information.

On AI and research, 20 million euros will accelerate AI and digital adoption in businesses, while 25 million targets applied research - including decarbonised aviation - and another 25 million supports materials reuse and raw-material security.

To fund these measures, the government is curbing spending. Nursing homes will see their funds less indexed over three years, though worker wages remain indexed. The Walloon Parliament’s allowance will not be indexed, and municipal and provincial endowments from the region will be less indexed over three years. Longer term, the number of Walloon municipal councillors will be reduced by 510 - but only after the 2030 municipal elections.

On the Boucle du Hainaut, at least 8 km of the 85-km high-voltage line will be buried, with more where technically and environmentally possible. A public enquiry is planned for early 2027, with final adoption hoped for by the end of that year.

The Fiscal Reckoning

The budget was presented against a difficult backdrop. Wallonia’s deficit stands at around 2 billion euros, and growth is projected at just 0.6-0.7% for the year. The region now targets a 2027 deficit of 1.35 billion euros, compared with more than 2 billion this year - still well behind Flanders, which expects balance by 2027, versus Wallonia’s 2029 target.

Dolimont has acknowledged the difficulty. “The most recent projections reveal new tensions on revenue, expenditure, and interest charges,” he said late last month. “The government must therefore adapt the method and pace of its action without renouncing the direction it has set.”

The announcement also unfolded amid a federal political crisis. Prime Minister Bart De Wever’s coalition remains deadlocked over the federal budget, with the MR refusing a VAT increase from 21% to 22%. De Wever has cancelled his State of the Union address and warned against a stopgap “provisional twelfths” budget.

The political context colors the reception of the Walloon plan. The far-left PTB has already criticized the government’s employment record. Germain Mugemangango, the PTB’s group leader in the Walloon Parliament, described the employment situation as “catastrophic,” accusing the Dolimont government of “destroying jobs instead of creating them,” according to La DH.

What’s Next

The three-year trajectory now gives Walloon businesses and households a longer planning horizon - a deliberate contrast to the uncertainty at the federal level. But the path to 2029 depends on growth that has so far been sluggish, revenue that remains under pressure, and a political coalition that must hold together through a turbulent federal budget season.

The inheritance reform and job bonus both take effect in 2028, making next year one of preparation and legislation. For Wallonia’s families and workers, the budget signals welcome relief on taxes and a preserve-the-model approach to family support. Whether the region can finance those commitments without deeper cuts - and whether the federal deadlock spills into regional politics - remains the central question.