Luxembourg has published an amendment to the VAT Act, which includes a provision temporarily reducing current VAT rates by 1%.

Timeline

The new VAT rates will be effective between January 1 and December 31, 2023.

The new rates

The VAT rates will change as follows:

• Standard rate – lowered from 17% to 16%
• Intermediate rate – lowered from 14% to 13%
• Reduced rate – lowered from 8% to 7%

The reduction does not apply to the super-reduced rate, which will remain at 3%.

Companies must be ready to update their systems once the new rates are effective, and modify them again when the temporary reduction ends.

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