The Luxembourg Chamber of Deputies is reviewing Bill 8406, proposing amendments to the law of 12 February 1979 on value added tax (VAT), aligning with Council Directive (EU) 2020/285 of 18 February 2020, Council Directive (EU) 2022/542, and the special scheme for small enterprises and Regulation (EU) 904/2010.
The changes focus on the special VAT scheme for small businesses, the application of reduced VAT rates, administrative cooperation, and the exchange of information regarding VAT payments.
The amendments were presented to the parliament on 1 July, 2024. The measures will take effect on 1 January, 2025 after approval.
Proposed key measures
- An optional VAT exemption threshold for small businesses will be increased from EUR 35,000 to EUR 50,000 in annual turnover;
- An optional VAT exemption for taxable persons in other EU Member States, provided their total annual turnover in the EU does not exceed EUR 100,000;
- An optional VAT exemption for taxable persons in other EU Member States, provided their total annual turnover in Luxembourg remains under EUR 50,000;
- New regulations for taxable persons in Luxembourg to claim a VAT exemption for transactions in other Member States, provided their total annual turnover in the EU does not exceed EUR 100,000.
