The Positioning of Luxembourg as a European financial hub

Luxembourg has long been a reference point for international companies, including Italian entrepreneurs, both financially and commercially. This small state in the heart of Europe has carved out a leading role for itself as a major financial and commercial centre.

Political stability, an advantageous tax regime, excellent connections to European markets and a highly qualified workforce are just some of the factors that make it an ideal destination for Italian companies wishing to expand internationally.

Why is Luxembourg interesting for Italian companies?

On the tax side, the country offers a 17% IRC, one of the lowest in Europe, and specific concessions for holding and investment companies, promoting a favourable investment environment. Its strategic location in the heart of Europe facilitates access to global markets, supported by state-of-the-art logistics and technology infrastructure. The diversified and robust financial sector includes more than 4,000 investment funds with assets under management in excess of EUR 5 trillion, supported by a strong legal and regulatory framework ensuring high standards of investor protection.

The insurance sector, in particular the reinsurance sector, is another important pillar of Luxembourg’s financial centre. Since Brexit, Luxembourg has assumed an even more prominent role as a European hub for non-life insurance, attracting international companies wishing to serve clients throughout the EU.

The country has developed strong expertise in sustainable finance and is the world’s leading hub for sustainable investment funds. Companies benefit from an innovation-friendly environment, supported by advanced technological infrastructure and a strong commitment to ESG (Environmental, Social, and Governance) issues.

Conclusions

The Luxembourg market offers a stimulating environment for Italian companies wishing to expand internationally. The assistance of a specialised tax advisor is essential to effectively navigate the country’s complex legal and tax landscape. These professionals can support companies in opening branches, choosing the most suitable corporate structure and obtaining the necessary authorisations.

An experienced consultant also facilitates liaison with local partners, facilitating strategic meetings with customers, suppliers and other business actors in Luxembourg. Managing day-to-day operational issues such as accounting, taxation and human resources management becomes more efficient with their support, allowing companies to focus on developing their business.

Luxembourg’s tax system is a significant attraction: with competitive VAT and one of the lowest corporate taxes in Europe, Luxembourg also favours holding and investment companies with favourable tax regimes. This environment is not limited to finance, but also extends to other sectors such as logistics, information technology, biotechnology and green energy. The country’s strategic location in Europe, modern infrastructure and strong support for innovation make it an ideal hub for various industries.

In short, Luxembourg offers a unique mix of economic stability, tax benefits, geographical accessibility and an innovation-friendly environment. With the right support, Italian companies can maximise the opportunities offered by this dynamic and competitive market, positioning themselves for lasting success and sustainable international growth.