Luxembourgers give money to the state for six months

Every year, the Molinari Institute evaluates the Social and Tax Freedom Day - the day on which the average worker (single and without children) has paid all state taxes and levies on income (including employer and employee social contributions, income tax, VAT). This year, France is the last country to celebrate this day, on July 17, followed by Belgium (July 15) and Austria (July 12), with tax burdens of 54%, 53.5% and 52.9% respectively.

Luxembourg has a tax burden of 44.9%, exceeding the EU average (44.3%) for the first time. Luxembourg employees are exempt from tax on June 13 (compared to June 11 in the EU), three days later than in 2023 and almost a month later than in 2015.

In Luxembourg, the average worker's annual salary is 80,298 euros. After deducting the employer's social contributions (10,739 euros), the employee's social contributions (8,644 euros), income tax (14,347 euros) and VAT (about 2,608 euros), his real income is 44,591 euros. This is the highest in the EU, where the average remains at 21,654 euros. The Grand Duchy's figures are also higher than those of the Netherlands (38,978 euros) and Ireland (38,178 euros).

Thus, for an average employee in Luxembourg to have 100 euros of purchasing power, the employer must spend 181 euros, of which 43 euros are social contributions. It is worth noting that in Luxembourg, employer and employee social contributions are almost equal - 30% and 24%, while the EU average is 38% and 22%. Income tax is 39% (compared to 31% in the EU) and VAT is 7% (compared to 9% in the EU).