Tax reform details announced
Source: Christian Dubovan, Unsplash
In 2025, tax relief will be extended to everyone in tax class 1A, including single parents, people over 64 and widows/widowers. In addition, those earning the minimum wage of an unskilled worker will be exempt from tax, and bonuses and incentives paid to expats will become more attractive from a tax perspective.
Corporate tax will also be reduced by 1%. Cross-border workers from Germany who work overtime will be able to claim a tax credit of up to 700 euros. Employees under the age of 30 will be exempt from tax on bonuses and profit-sharing paid by their employers.
The new measures were presented by Finance Minister Gilles Roth and approved by the Council of Ministers on Wednesday morning. They were read out to the Parliament's Scientific Commission on Finance and then to the press.
The biggest benefits will come from the changes to the tax scale that will take effect on January 1, 2024, as well as the additional indexation of wages in 2025 and the increase in the tax credit for single parents.
