Luxembourg’s state revenue experienced a significant increase, reaching €23.9 billion by the end of September 2026, marking a rise of €2.2 billion or 9.9% compared to the same period last year. This growth was primarily fueled by tax collections, with corporate income tax revenue climbing to €3.3 billion, an increase of €582 million or 21.4% year-on-year. Additionally, revenue from the solidarity tax grew by 9.1% to €610 million, and the newly introduced national Pillar 2 tax contributed €239 million.
Further increases were observed in VAT and other revenue streams. VAT receipts rose to €4.7 billion, up 7.8%, while subscription tax revenue increased by 10.5% to €1.1 billion. However, not all areas saw growth; customs and excise revenue experienced a decline of 3.1%, totaling €1.8 billion.
Despite the robust revenue growth, Luxembourg’s state expenditure also rose, reaching €24.2 billion by the end of the third quarter. This constituted an increase of €1.98 billion or 8.9% from the same time the previous year. The rise in spending was largely driven by higher transfers to social security, municipalities, and the European Union budget, alongside increased public investment and employee remuneration.
As a result, the central government recorded a budget deficit of €339 million as of September 30, 2026, indicating that expenditure surpassed revenue despite the latter’s substantial increase. This financial outcome highlights the ongoing challenge of balancing revenue growth with rising state spending.