Luxembourg releases paper on tax transparency amid “Lux leaks” controversy

International Tax Review is part of Legal Benchmarking Limited, 1-2 Paris Garden, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2026

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Luxembourg releases paper on tax transparency amid “Lux leaks” controversy

On December 10 the Luxembourg Ministry of Finance released proposals relating to tax transparency and advance rulings. This move comes as no surprise in the light of the recent “Lux leaks” scandal and appears to be a strategic attempt at advertising Luxembourg’s willingness to fight tax evasion.

The position paper outlines that:

· A specific provision would be added to the tax law regarding transfer pricing documentation;

· From 2015, the tax administration would provide an annual report of all tax ruling issues for the year;

· The income tax law of Luxembourg would be modified to explicitly state that profit of related-party enterprises would be determined under an arm’s-length standard and then taxed according to OECD principles; and

· Requests for corporate tax rulings, filed with the tax office, would have to be submitted to the newly established supervisory commission (commission des decisions anticipées) which is authorised to issue a binding opinion on which the tax office’s advance ruling would be based.

According to the paper, these legislative changes, which are already considered administrative practice by the Luxembourg tax office, would be codified into law.

Perfect timing

There is no denying that the proposals were released in response to the “Lux leaks” scandal.

“The form and timing of the release was expected in the context of the recent “Lux leaks”. It is a move to clarify Luxembourg’s position that there should be more transparency around rulings,” said Keith O’Donnell of Atoz.

The proposals will come as no surprise to taxpayers who were already expecting significant changes to improve tax transparency in the country. The release of the proposals appears to be more of a publicity stunt to reassure the international tax community that Luxembourg is fully committed to tackling the fight against base erosion and profit shifting.

more across site & shared bottom lb ros

More from across our site

PwC Australia’s response to its tax leaks scandal could give KPMG a useful case study, but so far there’s little sign of positive lessons learned
Tom Goldstein’s attempt to overturn his tax conviction was shot down; in other news, Deloitte promoted several tax partners in Italy
The tax advisory firm becomes the latest member of the Andersen Global network, which has more than 50,000 professionals worldwide
A revised Chapter VII signals a move away from mechanical TP approaches, stressing transaction understanding, functional analysis and context-driven documentation requirements
HMRC’s growing focus on evidencing tax decisions is shifting attention from technical accuracy to governance, requiring businesses to demonstrate how positions were reached and documented
Australia’s Department of Finance will also commission an independent review of KPMG’s governance, culture, ethics and integrity frameworks, it has revealed
In the second instalment of this two-part series, Jayne Stokes takes a practical approach to navigating the capital v revenue question for UK R&D claims for software development, and shares pointers for businesses
ITR's latest podcast considers how transformational the buyout could be in Ryan's quest for global advisory reach and analyses a recent boom in demand for private client advisory services
The event comes at an important moment for professionals dealing with practical realities related to this practice area
Germany’s dogmatic restriction of third-party investment in tax advisory firms will only serve to slow down innovation and access to justice
Gift this article