What happened?
Luxembourg’s government presented Budget Bill 8800 on 7 October 2026. The proposed corporate-tax package combines lower national rates with changes to loss carryforwards and investment credits. This analysis examines the proposal; it does not report enacted relief.
Key details
The bill would reduce the lower national corporate income tax rate from 14% to 13% and extend its taxable-income ceiling from €175,000 to €200,000. Income above €250,000 would face 15%, down from the current standard 16%. Between the proposed thresholds, tax would be €26,000 plus 23% of income exceeding €200,000.
It would remove the 17-year carryforward limit for losses incurred in financial years ending after 31 December 2016, for both corporate income tax and municipal business tax. Other conditions for using losses would remain.
The credit for qualifying digital transformation or ecological and energy-transition investment and expenditure would rise from 18% to 21%. For eligible tangible depreciable assets, the specific credit would rise from 6% to 9%, alongside the existing 12% global investment credit; the 21% is not an additional credit on top of both components.
Who is affected?
Luxembourg taxable companies are directly affected. GCC groups with Luxembourg subsidiaries or taxable investment structures should assess their own position. Ownership through a Luxembourg vehicle does not establish that every investment, fund or income stream qualifies for these measures.