Introduction of the notional interest deduction regime : the right time ?

By CHIARA BARDINI, DIRECTOR, ASHURST LLP, LUXEMBOURG BRANCH and CÉCILE HENLÉ, AVOCAT À LA COUR, ASHURST LLP, LUXEMBOURG BRANCH
11 août 2021 par
vanessa Icardi Serrami

The Luxembourg macroeconomic and budgetary situation and outlook for 2020 and 2021 are sobering. The first round of effects of COVID-19 and the impacts of a new wave of infections are difficult to capture, so no one can predict at this stage how the situation will actually unfold in the coming months.

Several reports were recently released by Luxembourg and European organisations and institutions analysing the economic situation and anticipated economic developments.

As far as Luxembourg is concerned, among the key highlights mentioned in these reports are the projected GDP fall by 6¼% in 2020 as a result of the COVID-19 outbreak. Furthermore: “The volatility on financial markets following the outbreak of the health crisis and the decline in economic activity is projected to weigh on the value added of the financial sector, which represents a large share of Luxembourg’s GDP. For 2021, a rebound in GDP growth to 5½% is expected, but with risks that are mainly on the downside, depending on the evolution of the health situation and the developments in the financial and external sectors.”

Lire l'article complet, extrait de la Revue de Droit Fiscal (RDF), n° 9

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