Luxembourg proposes higher digital and green investment credits

Two targeted rate changes

Article 4(11) would amend Article 152bis, paragraph 3, second subparagraph, of the Income Tax Law of 4 December 1967. It replaces 18% with 21% for the certified expenditure covered by that provision, while increasing its separate rate for depreciable tangible assets from 6% to 9%. This is a proposal, not an enacted increase.^[1]

The Bill’s commentary explains why the tangible-asset rate is lower: where an asset independently qualifies for the ordinary 12% global investment credit under paragraph 7, adding that credit to the proposed 9% produces 21%. The calculation remains subject to the exclusions in paragraphs 4 and 7; it is not a flat 21% credit for every asset, nor a new 21% credit to which 12% is automatically added.^[1][2][3]

Certification and eligibility still matter

The Law of 22 December 2023 introduced the digital and transition regime from assessment year 2024. ACD’s informational coordinated text, updated on 8 May 2026, reproduces its 18% and 6% rates and the eligibility framework. It expressly states that it is not an official legal consolidation. The proposed amendment changes the two numbers, rather than replacing that framework.^[1][2][3]

Under the reproduced framework, projects need an eligibility attestation and an annual certificate from the minister responsible for the economy. Only expenditure after the eligibility-attestation application can be certified; the certificate application must be submitted within two months after the financial year closes. Related-party software and patent acquisitions, routine advisory costs and specified excluded assets do not become eligible merely because a project is labelled digital or green.^[2][3]

Do not assume an application year

Article 32 specifically includes Article 4(11) in an exception to general commencement on 1 January 2027, but that exception’s assessment year ends at ‘20’ in the deposited text. The general date cannot safely supply the missing year. Groups assessing qualifying expenditure should separate the proposed rate uplift from eligibility, certification and timing assumptions, and check the final legislative wording before relying on it. This focused brief does not complete review of the wider Budget package.^[1][2][3]