FACT-CHECK: Is Belgium Giving Ukraine €1.7B Taxed From Russia’s Frozen Assets?

On Feb. 8, multiple outlets reported that Belgium would provide Ukraine with €1.7 billion ($1.8 billion) from the taxes generated from frozen Russian assets held by Euroclear.

The problem is the money might already have been spent. 

Euroclear is a Belgium-based securities house that handles large financial transactions between investors, major financial institutions and governments. It holds about €190 billion ($196 billion) of Russian central bank assets, according to a May 2024 Financial Times (FT) report. 

Belgian news outlet VRT reported the following: “Frozen Russian assets held by securities giant Euroclear in Belgium generated €1.7 billion in tax revenue for Belgium last year. That’s according to Euroclear’s annual figures.”

It added: “The Belgian state also levies a tax on all proceeds generated by the Russian assets. In 2024, this amounted to €1.7 billion. The Belgian government previously said the tax would also be used to fund aid for Ukraine.”

However, a Reuters report in March 2024 said the tax should have been paid last year. 

“Ukraine would also receive the tax that the Belgian government puts on the profits. For 2024, this is expected to amount to €1.7 billion, of which €1.5 billion [$1.55 billion] will be paid this year,” Reuters said. 

What happened then?

Profits, plus taxes

There are multiple streams of income generated by Euroclear’s Russian assets – profits, then taxes on the profits charged by the Belgians – some of which have already made it to Ukraine. 

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The VRT article said that one tranche from the profits made it to Ukraine in July 2024, and another is set to arrive next month.

“During the 2024 financial year, €3.55 billion was contributed to the [European Fund for Ukraine]. A first installment of €1.55 billion was paid into the fund in July 2024, a second payment of some €2 billion will follow [in March 2025],” the report reads. 

Thus, there are three figures – €1.55 billion paid in July 2024, approximately €2 billion to follow next month, and €1.7 billion of Belgian tax that the Belgian government supposedly said would go to Ukraine in a previous statement. 

Euroclear’s Feb. 5 press release confirmed these numbers. 

What did Euroclear say?

Euroclear said the profits would go to Ukraine but did not specify where the tax would go. 

“After retention of a 10% share of the windfall contribution to comply with capital and risk management requirements, Euroclear made a first payment for H1 2024 of approx. €1.55 billion to the European Fund for Ukraine in July 2024. A second payment for H2 2024 is expected to take place in March 2025 and should amount to approx. €2 billion,” the press release says. 

“Interest earnings related to Russian assets, which are subject to Belgian corporate tax, generated €1.7 billion tax revenue,” Euroclear added. 

Kyiv Post reported the first tranche to Kyiv in July 2024. 

Reuters was right about the €1.7 billion in taxes in its March 2024 report, but Kyiv Post cannot ascertain the claims about the €1.5 billion planned for last year. 

However, the big question remains – where is the €1.7 billion supposed to go? 

Unclear destination of the €1.7 billion in taxes 

VRT said: “The Belgian government previously said the tax would also be used to fund aid for Ukraine,” but Kyiv Post cannot identify official statements from the Belgian government that specify its plans with the €1.7 billion in taxes. 

In May 2024, an FT article said €1 billion out of the €1.7 billion is supposed to go towards military aid for Ukraine. 

“This year, tax revenue from Euroclear linked to Russian assets is expected to rise to €1.7 billion, of which €1 billion has been earmarked for military aid to Kyiv, according to the Belgian government,” the article says. 

An official but now-defunct page of Belgium’s support for Ukraine, last updated in May 2024, appears to corroborate part of the FT’s claims. 

The page said Belgium’s “planned support for 2024 and 2025” amounts to €1.7 billion – though it did not specify if it came from corporate taxes levied on the assets’ profits. 

The planned €1.7 billion comprised €412 million for three military support packages, €200 million to procure artillery shells under the Czech initiative, €100 million to maintain and support F-16 donations to Ukraine, and a new military support package of €204.3 million after “[redistributing] the Ukraine fund” – just shy of €1 billion in total. 

But that begs the question – if the “planned support for 2024 and 2025” amounts to €1.7 billion – does that mean the money has already been spent? 

Or will that be part of a new, unannounced package? We shall see.