On 14 October 2020, Luxembourg's Ministry of Finance, Pierre
Gramegna, tabled before the Parliament the draft budget law for the
year 2021 (the "Draft Budget Law").
The Draft Budget Law proposes amendments which aim at restoring
tax justice. In this context, it is noteworthy that some of the
most salient tax measures included therein would affect the real
estate industry and the current stock-option regime.
Please find below the key suggested tax measures:
- Introduction of a 20% withholding tax on income derived
by Luxembourg investment funds from real estate located in
Luxembourg
The Draft Budget Law proposes to introduce a 20% withholding tax
levied on income (e.g. rental income, capital gains) from a
property located in Luxembourg held directly or indirectly (i.e.
through one or more transparent entities or common funds) by
"Luxembourg Investment Funds".
