Luxembourg Government Council on 25 March 2020 approved a draft law to limit the tax deductibility of interest and royalties paid or due to related entities or associated enterprises located in a country that is listed on the EU list of non-cooperative countries and territories (the “EU blacklist”).
The draft law has been filed with the Luxembourg Chamber of Deputies under bill number 7547, on 30 March 2020; and it must now follow the usual legislative process before becoming law.
The bill follows the December 2019 conclusions of the Economic and Financial Affairs Council of the EU (ECOFIN), and reflects the need for EU Member States to agree to take coordinated defensive measures against blacklisted jurisdictions.
Read a March 2020 report prepared by the KPMG member firm in Luxembourg
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