This text is an AI-generated translation of the original.
Lower taxes, more purchasing power and a single tax class for everyone. Tax reform is the big topic in the parliamentary week from 26 to 29 October. In addition, a number of other legislative bills are on the agenda, which are intended to bring tangible relief for people and businesses.
One tax class for everyone from 2028
On Wednesday, 28 October 2026, Parliament is set to vote on the major tax reform. From 1 January 2028, Luxembourg will introduce a new, single tax class “U”. It will gradually replace the current tax classes 1, 1a and 2.
The aim is a simpler and fairer tax system. Whether single, married or in a civil partnership: in future the same tax rules will apply. For many people, especially singles, this means lower taxes and therefore more net pay from gross.
For couples who are currently in tax class 2, a transition period of 25 years is предусмотрено. They can remain in the old tax system for that long or switch to the new tax class.
The reform comes from Finance Minister Gilles Roth. CSV MP Diane Adehm is the rapporteur of the bill.
More purchasing power already in 2026 and 2027
Tax relief measures are also planned in the short term.
For people on low wages, the tax credit at the minimum wage will be increased in two stages: from today’s 81 euros to 179 euros in January 2027 and to 200 euros in July 2027. Together with the increase in the minimum wage, this means that for a person on the unskilled minimum wage, from July 2027 it will amount to around 200 euros more net per month compared with June 2026.
For the period from June to December 2026, an additional economic-cycle tax credit is also planned. This is intended to provide tax relief for employees, pensioners and the self-employed. From 2027 onwards, this relief is to be incorporated into the tax scale.
Something is also set to change for home savings schemes: the higher tax-deductible limit of 1,344 euros per year is to apply from 2027 onwards regardless of age. This means that people over 40 will also benefit from the same maximum tax advantage.
Financial aid for farmers and electromobility
In addition to taxes, exceptional aid for agriculture is also planned. Due to high fertiliser prices, farmers and winegrowers are to receive 35 euros per hectare, with a maximum of 10,000 euros per farm. CSV MP Jeff Boonen is the rapporteur of the bill.
Next is the extension of state aid for electric cars. Until 2030, under certain conditions, up to 6,000 euros for a new electric car and up to 1,500 euros for a used one will be possible.
The installation of charging stations will also continue to be supported: with up to 1,200 euros for a smart home charging station and up to 40,000 euros for shared installations in residential buildings. The rapporteur for both projects is CSV MP Paul Galles.
More safety for medicines and tax benefits for progressive retirement
A new Luxembourg agency for medicines and health products is intended to improve checks and monitoring. The aim is greater safety for patients. The rapporteur is CSV MP Françoise Kemp.
A change is also planned for people who reduce their working hours at the end of their career while already receiving part of their pension. Under certain conditions, they should be able to benefit from a tax relief of up to 750 euros of income per month. This is to apply to the private sector and the public service. CSV MP Diane Adehm is the rapporteur.
This parliamentary week is therefore particularly focused on purchasing power. With the new single tax class from 2028, the spotlight is on a reform that is intended to bring lower taxes and more net pay from gross for many people.
More information: Tax reform 2028 – One tax class for everyone.
The full agenda of Parliament: Parliamentary agenda