The Luxembourg government on 14 October 2019 presented the 2020 draft budget law (bill 7500).
The bill is subject to the legislative process and may be amended before its vote in the Chamber of Deputies.
The bill’s main tax measure relates to advance tax agreements issued before 1 January 2015. These agreements are no longer to be valid after the 2019 tax year. In 2015, the advance tax agreement procedure was updated and formalized in Luxembourg domestic law that limited the validity period of such agreements to five years. The bill’s new measure would provide for a transition between the old procedure and the new one.
While advance tax agreements issued before 2015 may no longer be useful to many taxpayers—for example, due to a change in the law or to transactions that have stopped being effective—the new measure could still affect certain taxpayers that may request new agreements under the new procedure to cover subsequent tax years (from the 2020 tax year and onward).
Read an October 2019 report prepared by the KPMG member firm in Luxembourg
The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.