LSAP and Green Party challenge government on tax revenue claims

On Wednesday, Taina Bofferding and Sam Tanson, responding to statements by Finance Minister Gilles Roth, disputed the government's claim of credit for the significant increase in state tax revenues.

The parliamentary group leader of the Luxembourg Socialist Workers' Party (LSAP) and the Green Party (Déi Gréng) MP argued that the additional revenues were primarily due to companies finally paying taxes on high profits from previous years, rather than any actions taken by the government.

Both parties, along with the Alternative Democratic Reform Party (ADR), accused the government of lacking a long-term strategy and vision for the future. As a result, the LSAP, ADR, and the Green Party announced they would vote against the proposed budget and the multi-annual plan.

LSAP criticises government's approach to key issues

Bofferding expressed disappointment over the government's retreat in areas such as housing, poverty, and environmental policy. She also reiterated her concerns about the slow progress on land tax reform and the mobilisation tax.

© Chamber of Deputies

Additionally, Bofferding criticised the tax advantages granted to housing investors, citing a recent assessment by the Luxembourg Central Bank (BCL) that described these measures as "anti-competitive and anti-social." According to Bofferding, these incentives would not make housing more affordable but would likely have the opposite effect.

In light of these concerns and recent tensions between the government and trade unions, Bofferding concluded that the government's "new mantra" seemed to be "business first."

ADR criticises migration policy and proposes cost-cutting measures

Fred Keup, president of the ADR parliamentary group, highlighted the negative effects of Luxembourg's growth, including rising housing costs for young people and increasing traffic congestion. He referred to past warnings from Christian Social People's Party (CSV) politicians about potential infrastructure problems. Keup also called for a shift in the country's migration policy.

© Chamber of Deputies

While the ADR does not oppose migration, Keup argued that Luxembourg should focus on attracting "skilled workers or talents" rather than what he termed "asylum migrants." The ADR politician claimed that, according to his own research, the latter group would cost the state more than they would contribute.

In addition, Keup proposed several measures to reduce government spending, including lowering development aid from 1% to 0.7% of GDP and cutting the number of advertising campaigns. He also suggested reducing the VAT on alcohol from 17% to 3% to support the sector.

Green Party questions missing details and criticises government priorities

Sam Tanson of the Green Party also expressed concerns over the government's handling of unions, NGOs, and budget policy. While she acknowledged some positive measures, such as the introduction of a tax-free minimum wage and adjustments to the tax scale to account for inflation, she criticised the scaled-back investments in housing, environmental policy, and the tram system.

Tanson further pointed out the absence of crucial figures in the budget, including the costs associated with measures for investors and the implementation of international minimum taxation for companies.

One key issue Tanson raised was the absence of the "nest egg" that Finance Minister Gilles Roth kept bringing up while he was still a member of the opposition. In response, Tanson introduced a motion based on a proposal from Romain Bausch, head of the National Council for Public Finances, suggesting that unexpected additional revenues should be set aside.