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Major tax reform to pass with CSV-DP votes alone

Luxembourg's major tax reform will be adopted exclusively with the votes of the governing coalition: the Christian Social People's Party (CSV) and the Democratic Party (DP). On Tuesday morning, members of the Chamber of Deputies' Finance Committee from CSV and DP approved the reform report. Lawmakers from the Luxembourg Socialist Workers' Party (LSAP) and the Pirate Party abstained, while the Alternative Democratic Reform Party (ADR) and déi Gréng (The Greens) voted against. Déi Lénk (The Left) told RTL they have not yet reached a final decision on their voting stance.

The reform, introduced by Finance Minister Gilles Roth, will overhaul Luxembourg's tax system by moving to individualised taxation. The three current tax classes will be replaced by a single "U" scale, modelled on the existing 1A class.

Single taxpayers will see the greatest relief, while lower income earners will benefit most in percentage terms. However, almost all taxpayers – including those with higher incomes – will gain something in absolute terms under the new system.

Married couples for whom one partner earns more than 75% of the household income, and who would lose out under the new "U" scale, will benefit from a 25-year transitional period. The reform is scheduled to take effect in 2028. Critics have noted the reform's estimated annual cost of nearly €1 billion, as well as its focus on encouraging dual-income households where both partners are in employment.

The Chamber of Deputies is expected to vote on the tax reform in the week of 27 October.

Also today

• Land prices for residential buildings in Luxembourg fell sharply between 2022 and 2024, stabilising in 2025.
• Benoît Elvinger to take over as new CEO of Spuerkeess.
• Finnish President Alexander Stubb begins official visit to Luxembourg.
• Clashes between French teens and police as school blockades intensify.
• UN Security Council extends gang suppression force in Haiti mission by 6 months.
• Paris Eiffel Tower says chief to step down after uproar over removing women staff.

On air

It's the big game tonight – no, not England – but Luxembourg vs Iceland and Tom is getting nervous and excited! There is a ticket giveaway too!

Figure of the day

Luxembourg’s unemployment rate has reached 6.5%

• Luxembourg’s unemployment rate has climbed to 6.5%, its highest point since 2021, but there are signs the labour market could be gaining momentum, as the number of temporary job offers has already risen by 9% this year.
• Laurent Peusch, head of the Employers’ Service at the National Employment Agency (ADEM), says this is a positive indicator. He notes: “The temporary employment sector is a real indicator of when hiring is on the rise. When employers remain uncertain about long-term prospects, they often rely heavily on temporary contracts.”

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