Legislation in Luxembourg: what is changing in 2019
As every year, January 1st marks the date of entry into force of new laws or legislative changes. This year 2019 is no exception to the rule. Let us review the changes that will take place in 2019, following, among other things, the coalition agreements of the new government led by Xavier Bettel.
Increasing the minimum wage and social inclusion income
One of the key measures of the new coalition government’s five-year programme is the increase in the minimum reference wage, which is expected to increase by €100 in 2019. A first concrete increase took place on 1 January 2019, bringing the minimum social unqualified wage to 2,071.10 euros per month and the minimum social qualified wage to 2,485.32 euros per month.
Similarly, the Social Inclusion Income – REVIS (formerly RMG), paid to more than 10,000 households in Luxembourg, increased by 1.1%.
Personal and corporate taxation
In the field of taxation, VAT on basic hygiene products should be reduced to 3%.
As for companies, they should also benefit from a 1% reduction in the IRC and ICC rates (IRC – Local Authorities Income Tax on the enrichment of certain capital companies, ICC -Municipal Commercial Tax on the profits of commercial companies).
Depenalisation of cannabis
While the coalition agreement plan the decriminalisation of recreational cannabis under conditions yet to be defined, medical cannabis is already available in several Luxembourg pharmacies since the end of 2018 in order to relieve patients suffering from certain pains or diseases.
Incapacity to work and salary maintenance by the employer
From 2019 onwards, it is now over a reference period of 18 months and no longer 12 months that the employee is entitled to maintain his salary until the end of the month in which the 77th day of incapacity for work falls.
After successive decreases, fuel prices at the pump are expected to increase in 2019, following the increase in the tax on petroleum products. If no date is defined at the moment, this increase should be around 1 to 3 cents per litre.
Annual leave for employees in Luxembourg is expected to increase by an additional 2 days in 2019, as salaries already have 25 working days of paid leave per year. One of these additional days of leave could result in an additional public holiday on 9 May as Europe Day.
As from 1 January 2019, it is no longer possible to get free plastic bags in stores and other points of sale. These are now subject to a charge. Learn more about waste recycling.
While these measures have already been implemented to a greater or lesser extent, others should be debated in 2019, such as a ban on smoking on terraces or a change in hunting procedures following petitions. A referendum on the Constitution is also expected to take place in 2019.