This week, the administrative court ruled against both municipalities and said they were not entitled to any compensation from the State for 2019 and 2020.
Home affairs minister Léon Gloden said he empathised with the municipalities, and referenced short-term amendments to municipal finances, following a surplus in the commercial tax and the endowment fund for the year.
“We received 53 million more than we anticipated when we drew up a report on the 2023 budget. This surplus can benefit all municipal councils. So we in the Superior Council of Finances have decided, once the budget has been approved, that we can pay out 15.85 million more per instalment for the municipalities.”
The Employment Fund is also likely to return to the pre-2017 system of making each municipality pay 2% of commercial taxes - a change which has been approved by the Superior Council of Municipal Finances. The unemployment law will be adapted accordingly.
“This particularly affects the municipalities of Leudelange and Niederanven,” commented Gloden. “They pay 1.7 million and 2.2 million euros respectively to the Employment Fund. There are a number of municipalities, including very large ones that pay nothing at all, while smaller councils end up paying more than they receive from the commercial tax.”
Gloden will also address municipal subsidies, setting up a working group alongside the Syvicol municipal syndicate to see what changes could be brought in to better support councils.
Next, the municipal finance law from 2017 will be subjected to reforms. These amendments will see everything up for discussion, Gloden promised, including the adjusted population criteria which both Leudelange and Niederanven have struggled with. However, the exact reforms are yet to be determined.
