The European Commission has given a broadly positive verdict on Belgium’s public finances, saying the country’s federal budget remains “on track”

despite a modest overshoot of spending limits next year.

In its assessment of Belgium’s 2026 draft budget, submitted in January, the Commission notes that net expenditure is expected to rise by 3.8% in 2025—slightly above the agreed ceiling of 3.6%. The deviation, equivalent to around 0.1% of GDP, is deemed acceptable under the national escape clause, which allows extra flexibility for defence-related outlays.

Spending growth is set to ease in 2026, with net expenditure forecast to increase by 1.9%, comfortably below the 2.5% limit set under EU fiscal rules.

Belgium remains under the EU’s excessive deficit procedure, which was launched in the summer of 2024 after its deficit and debt levels breached treaty thresholds. Eight other member states are currently subject to the same scrutiny.

The Commission’s analysis also factors in a proposed overhaul of value-added tax by the so-called “Arizona” coalition. Planned VAT increases on culture, sport and takeaway food have since been shelved—at least for now—leaving a budget hole of more than €400 million. The government led by Bart De Wever has committed to closing the gap through alternative measures.

On the economic outlook, Brussels largely shares the government’s view. It expects Belgium’s economy to grow by 1.1% in real terms in 2026, in line with official projections, while inflation is forecast to come in slightly higher, at around 2%.

A more detailed evaluation of Belgium’s fiscal path is scheduled for June, when the Commission publishes its next round of reports under the European Semester framework.