Luxembourg cuts the VAT rates by 1% starting January 2023

Luxembourg cuts the VAT rates by 1% as a temporary measure to fight inflation. The temporary reduction will end by 1 January 2024.

VAT rates reduction in Luxembourg

##Update November 2023: By 1 January 2024, the VAT rates in Luxembourg will get back to normal. This is 17%, 14% and 8% will be applicable again. Get ready for the change! Find the official information here.

The Luxembourg government agreed to reduce the VAT rates by 1% with effect from January 2023 to December 2023, in principle. This is a temporary measure decided in the context of high inflation rates.

The VAT rates applicable in Luxembourg from January to 31 December 2023 are:

  • Standard VAT rate: 16% instead of 17%.
  • Reduced VAT rate: 13% instead of 14%.
  • Reduced VAT rate: 7% instead of 8%.

In principle, the super-reduced VAT rate of 3% will remain unchanged. This VAT rate applies in general to food products, pharmaceuticals, books, magazines and newspapers, children’s clothing and shoes, restaurant services, and passenger transport.

Check the VAT rates applicable by goods and services in Luxembourg here.

How can Marosa help?

Lately, many countries reduce temporarily the applicable VAT rates as a measure to combat the negative impact of inflation on their economies and mitigate the social effects. From a VAT perspective, it is key to understand the tax point rules in each country, so you charge the correct VAT rate according to the tax point dateMarosa can help you determine the correct VAT treatment and applicable VAT rates for your transactions; feel free to contact us to ensure you are VAT compliant.

Related VAT news

We use cookies to offer an improved online experience. More information