Lowtax Network

Back To Top

Your Lowtax Account

Luxembourg: Country and Foreign Investment


Luxembourg is a constitutional monarchy. The current sovereign is HRH Grand-Duke Henri; and the heir apparent is Prince Guillaume (son of the monarch). Under the Grand-Duke there is an Executive Cabinet of 12 Ministers; legislative power is in the hands of the Chamber of Deputies (Parliament) elected by universal suffrage under proportional representation for a term of not more than 5 years.

The Parliament has 60 members, and there are three main political parties, Christian Democrats, Socialists and Liberals, who alternate as coalition partners and who over time have provided a good measure of stability and continuity. Proposed legislation is reviewed by the Conseil d'Etat, who have some powers to block legislation from continuing to a final vote.

Luxembourg law reflects the country's history: most civil and commercial law is French in origin, while company and penal law has Belgian roots, and direct taxes are essentially those introduced by the Germans during their occupation of the country in the Second World War. EU law is of course adopted into national law and is the source of VAT regulation among other things.



Back to Luxembourg Index »