Country-specific updates: Luxembourg

The law introducing a temporary reduction of VAT rates was enacted in Luxembourg. To the exception of the super reduced rate (3%), all applicable VAT rates in Luxembourg should be reduced by 1% for the period 1 January to 31 December 2023. The standard rate for the period will therefore be 16%, while the intermediary rate will be 13% and the reduced rate will be 7%.

Cut off point and what rate (the “old” or the “new”) applies to a specific transaction should be carefully considered and businesses may want to adapt their internal systems accordingly.