By the end of September 2026, Luxembourg’s state revenue experienced a notable increase, reaching €23.9 billion, which represents a 9.9% rise compared to the same period in the previous year. This boost in revenue was largely driven by increased tax collections, with corporate income tax revenue climbing to €3.3 billion, marking a 21.4% increase year-on-year. Additionally, revenue from the solidarity tax rose to €610 million, an increase of 9.1%, and the newly implemented national Pillar 2 tax contributed €239 million.
Further contributing to the revenue growth were value-added tax (VAT) receipts, which increased by 7.8% to €4.7 billion, and subscription tax revenue, which rose by 10.5% to €1.1 billion. However, not all revenue streams saw increases; customs and excise revenue decreased by 3.1% to €1.8 billion.
Despite the substantial growth in revenue, state expenditure also rose, reaching €24.2 billion by the end of the third quarter. This reflects an 8.9% increase from a year earlier, primarily driven by higher transfers to social security, municipalities, and the European Union budget, as well as increased public investment and employee remuneration.
The overall financial picture for Luxembourg remains challenging, as the central government recorded a budget deficit of €339 million as of September 30, 2026. While revenue growth remains strong, the increase in spending continues to outpace income, contributing to the deficit.