In Luxembourg, Value-Added Tax (VAT) is levied. VAT is a general consumption tax that is charged directly on the sale of goods and services in Luxembourg.
The different VAT rates in Luxembourg are:
| Rate | Type | Goods and services |
|---|---|---|
| 17% | Standard | All goods and services, except those excluded |
| 14% | Intermediary | Certain wines; washing and cleaning products; advertising pamphlets; management and safekeeping of securities; heating, ventilation and air conditioning; flammable solid minerals, mineral oil and firewood used as fuel;… |
| 8% | Reduced | Supply of gas and electricity; cleaning in private households; hairstyling; repair of bicycles, shoes and other leather items; cut flowers and plants for decorative use;… |
| 3% | Reduced | Certain foods and drinks; pharmaceutical products and medical equipment for disabled persons; certain books, newspapers and periodicals; radio and television broadcasting services; agricultural supplies; children’s clothing and footwear; domestic passenger transport; admission to cultural events and amusement parks; hotel accommodation; restaurants;… |
| 0% | Zero | Intra-community supplies of goods; exports |
Some goods and services are exempt from VAT, such as financial, insurance and educational services.
For the year of 2023 (January 1st to December 31st), the following reductions apply:
- Standard (17%): 16%
- Intermediary (14%): 13%
- Reduced rate (8%): 7%