In order to cope with inflation and following negotiations between members of the Luxembourg government as well as various economic actors (employers and trade unions), an agreement was reportedly reached on Tuesday 20/09/2022 providing for a temporary 1% cut in VAT rates to help households and businesses at a time of slowing global economic growth.
- The standard rate of 17% will be reduced to 16%;
- The intermediate rate of 14% will be reduced to 13%;
- The reduced rate of 8% will be reduced to 7%.
However, it should be noted that the super-reduced rate of 3% will remain unchanged.
The final agreement was signed on 28 September and the reduced VAT rates should apply from 1 January 2023 to 31 December 2023.
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Source: Government of Luxembourg (pdf in French)
