Luxembourg Tax News 2014-08 | KPMG | LU
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Luxembourg Tax News 2014-08

Luxembourg Tax News 2014-08



Head of Tax

KPMG in Luxembourg


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Etat de la Nation 2014

On 2 April 2014, Prime Minister Xavier Bettel held his statement speech on Luxembourg’s economic, social and financial situation.

Prime Minister Bettel reiterated the Government’s will to reinforce the country’s overall competitiveness, performance, efficiency and attractiveness for businesses. Strong government support will go to the financial services industry, to the ICT business, to the logistics sector, as well as to the eco & bio-technology industries. The same is true for the more traditional industry sectors, as well as for small and medium-sized businesses.

On the tax side, Minister Bettel announced (or confirmed) the following points:.

  • As from 1 January 2015, a 2 % point increase in the main VAT rates (15 to 17%, 12 to 14% and 6 to 8%), whereas the super-reduced rate of 3% applied on basic necessity products will remain unchanged (though adjustments will apply for secondary dwellings and alcoholic beverages)
  • Increased means will be put in place in order to fight VAT fraud
  • The Luxembourg tax system will be globally reformed with effect as from 1 January 2017, with the aim of maintaining both a fairness taxation for individuals and the competitiveness of companies
  • A notional interest deduction regime (as known in Belgium), initially contemplated in the coalition program of the Government, will not be put in place
  • All remaining necessary steps will be taken in order to ensure compliance with the international standards on tax transparency and exchange of information (as reviewed by the OECD Global Forum). In this respect, amendments to the initial bill on bearer shares have just been submitted to the Parliament.


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Any tax advice in this communication is not intended or written by KPMG to be used, and cannot be used, by a client or any other person or entity for the purpose of (i) avoiding penalties that may be imposed on any taxpayer or (ii) promoting, marketing, or recommending to another party any matters addressed herein.The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.


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