Lower labour costs in new Flemish support zones
December 2024 - Since 1 November 2024, four new support zones have been introduced in Flanders to replace the existing ones, and the dislocated zone aid will be extended for a period of six years.
This support measure offers companies investing in these zones a significant reduction in their wage costs when they create new jobs.
The dislocated zone aid was introduced to stimulate employment in economically vulnerable areas affected by major job losses, such as the closure of Ford Genk and Philips Turnhout, and the consequences of the Zaventem attacks. Companies that create new jobs in these zones can receive a 25% exemption on the withholding tax transfer for these new positions. This results in a 4-5% saving on labour costs.
The new support zones are: Limburg (Genk zone), Kempen (Turnhout zone), Antwerp-Brussels Axis (Machelen zone) and a new zone in West Flanders (Wielsbeke). Via the Geopunt website, companies can verify whether their location is in an aid zone. The aid only applies to jobs that increase the number of employees compared to the average of the previous 12 months and must be filled within 36 months of the investment. The job must exist continuously for at least three years, with exceptions for certain leave situations.
The dislocated zone aid can be combined with other aid measures, such as the charge reduction for shift and night work, the IPA rebate and business start-up exemption. However, combination with specific exemptions, such as for overtime and researchers, is not allowed. This measure offers companies an attractive financial incentive to invest in vulnerable regions and support employment.
