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Belgium creates $1.8 billion fund for Ukraine by taxing frozen Russian assets

by Elsa Court and The Kyiv Independent news desk October 11, 2023 5:02 PM 2 min read
Ukrainian President Volodymyr Zelensky and Belgian Prime Minister Alexander De Croo pictured after a meeting in Brussels, Wednesday 11 October 2023. (Eric Lalmand / Pool / Photo News via Getty Images)
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Belgium has created a 1.7 billion euro ($1.8 billion) fund for Ukraine financed by the tax revenue from interest on frozen Russian assets, the country's Prime Minister Alexander de Croo announced on Oct. 11.

Speaking in Brussels at a joint press conference with President Volodymyr Zelensky, who is in the city for a meeting with NATO defense ministers, de Croo said that the fund will be put to use next year "for military matters, humanitarian aid, and European support packages to Ukraine."

While the European Union is still considering whether it can legally confiscate frozen Russian assets to fund Ukraine's rebuilding, income taxes paid in Belgium from the interest on these assets go directly to the national government.  

"The taxation of income from these assets should go 100% to the benefit of the population of Ukraine," de Croo said at the press conference.

"Belgium has become the first country to start using frozen Russian assets to support protection from Russian terror," Zelensky posted on X, formerly known as Twitter.

"These funds will finance security assistance for Ukraine and fast recovery projects in our regions," he said, adding that he was "grateful to Belgium for all the support."

Much of the frozen assets are blocked at Euroclear Bank, which has a branch in Brussels, Belgian newspaper Het Nieuwsblad reported.

"As an international securities manager, Euroclear invests those frozen Russian assets and makes a substantial profit. They then have to pay Belgian corporate tax, which flows to the state treasury," Het Nieuwsblad explained.

In May 2023, de Croo mentioned plans to use the tax proceeds from frozen Russian assets to fund the rebuilding of Ukraine at a meeting with Zelensky and Dutch Prime Minister Mark Rutte in The Hague.

Belgium holds about 180 billion euros ($191 billion) in frozen Russian assets, de Croo said in The Hague.

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