Luxembourg: New bill to modernize investment tax credit
The bill will go through the usual legislative process and may still be subject to further amendments.
The bill will go through the usual legislative process and may still be subject to further
A new bill was submitted to the Parliament on 13 July 2023 that would substantially modify the investment tax credit for companies. This bill, which is part of the tripartite agreement (Solidaritéitspak 2.0.) between the government, the Luxembourg Employers’ Association, and the trade unions, intends to provide the necessary changes to promote investments into digital transformation, as well as ecological and energy transition.
The bill includes:
- A new investment tax credit for investments in digital transformation, and ecological and energy transition
- An amended tax credit for “global investment”
- A carry forward of the investment tax credit (except for the part attributable to software under the tax credit for global investment) for up to 10 years following the financial year during which the investments have been made
Next steps
The bill will now go through the usual legislative process and may still be subject to further amendments. Due to the upcoming summer recess of the Parliament and the parliamentary elections in October, it remains unclear when the bill will pass.
Once voted, the new tax credit will be effective from tax year 2024.
Read a July 2023 report prepared by the KPMG member firm in Luxembourg
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