Italy vs Luxembourg
Tax Rate Comparison
Enter your income below for a personal tax estimate, then scroll down for full rate breakdowns.
๐ฐ Personal Income Tax Calculator
Enter your income to see your estimated annual tax liability in each country โ side by side.
๐ฎ๐น Italy โ Regional & Municipal Income Taxes
Italy's 20 regions levy addizionale regionale at 0.7%โ3.33%. Municipalities add addizionale comunale up to 0.9%. Sicily, Sardinia, and Trentino-Alto Adige have special autonomous status. IRAP (regional business tax) at ~3.9% applies to businesses. Local property tax (IMU) is set by municipalities on investment properties. Cumulative marginal rates can exceed 50%.
๐ฑ๐บ Luxembourg โ Municipal Business & Property Taxes
Luxembourg's 102 communes levy the Gewerbesteuer (business tax) on companies at rates set by each commune (base rate 3% + municipal multiplier 175%โ400% = effective 6โ10.5%), and communal income tax additionals on individuals. Luxembourg City has higher rates than rural communes. The combined corporate tax (national + municipal) ranges from ~24.9% to ~26.01%. Luxembourg is a major holding company and fund domicile jurisdiction with extensive tax treaty networks.
Italy vs Luxembourg: Key Tax Differences (2026)
๐ฐ Income Tax: ๐ฎ๐น Italy has a higher top income tax rate (23โ43% vs 0โ42%). ๐ฑ๐บ Luxembourg is more favourable for high earners.
๐ VAT/Sales Tax: Italy has a higher consumption tax (4โ22% vs 3โ17%).
๐ข Corporate Tax: ๐ฎ๐น Italy offers a lower corporate rate (24% vs 24.94%), which can influence business location decisions.
๐ Capital Gains: ๐ฎ๐น Italy taxes investment gains at a lower rate (26% vs 42%), benefiting investors.