Luxembourg income tax rates, 2025

What is actually taken, at three incomes

The OECD models a single person with no children and no other income at three multiples of the Luxembourg average wage, and publishes what that person actually pays. These are outcomes rather than statutory rates: everything taken, divided by everything earned.

The same three incomes, in money

The rates above are what the OECD publishes. The amounts below are those rates applied to the gross earnings it publishes alongside them, which is arithmetic rather than a further source, and it is separated from the table above so that nothing computed here can be mistaken for something published. Rounding means the parts may miss the total by a unit.

Read the middle row across: someone on the Luxembourg average wage of €77,844 keeps €52,940 of it, and €24,904 is taken. At 67% of the average wage the amount taken is €12,022 and at 167% it is €50,803, so an income two and a half times larger carries a tax bill 4.2 times larger.

The two numbers that decide different things

On the Luxembourg average wage the average rate is 32.0% and the marginal rate is 51.5%. Those answer different questions and confusing them is the commonest mistake made with a table like this one. The average rate tells you what your year costs. The marginal rate, 19.6 percentage points higher here, tells you what the next unit of income costs, which is the number that decides whether a rise, a bonus or extra hours are worth taking.

Across the range the OECD publishes, the combined rate moves from 23.1% at 67% of the average wage to 39.1% at 167%, a spread of 16.0 percentage points over an income range of two and a half times. That is a steep profile: the share taken rises sharply with income, so a figure quoted at one salary says very little about another.

Nothing above includes what your employer pays. In Luxembourg employer social security contributions run at 13.7% of gross earnings, against 12.3% taken from you. The two sides are close to equal, which is unusual and means the payslip shows roughly half of what the contribution system actually costs.

The statutory schedule, as published

In 2025 Luxembourg has 23 central government bands, running from 0.00% to 42.00%, with the second rate starting at €13,230. It is shown as a table and nothing more. Set that top figure of 42.00% against the 19.7% actually taken from someone on the average wage, and the distance between a band rate and an average rate is the whole reason the first table exists.

Central government only, and what that leaves out is set out once rather than repeated on each of these pages.

Why Luxembourg has no calculator here

For Luxembourg the closest reading we could construct missed by 1.29 percentage points. Several other readings were tried and every one of them was further away. On a salary around the average wage a miss of that size is a real amount of money, and a reader would have no way to see it.

On the Luxembourg average wage of €77,844 that gap is about €1,004 a year, which is the amount a reader would have been wrong by without any way to see it. Why half a percentage point is the tolerance, and what a gap of this size usually turns out to be, is set out once rather than on each of these pages.

Where Luxembourg sits

Of the 38 jurisdictions the OECD publishes this series for, Luxembourg ranks 8 by the combined rate taken from a single person on the average wage, at 32.0%. Immediately above it: Denmark at 35.3%, Hungary at 33.5%, Austria at 32.5%. Immediately below: Finland at 30.7%, Türkiye at 29.3%, Italy at 28.6%.

What this page does not tell you

Everything above describes a single person with no children on €77,844, €52,940 of which they keep. It does not describe a couple, a parent, anybody with income other than a salary, or anybody at a Luxembourg salary between the three published points. The full list of what this kind of page cannot answer, including how regional taxes are handled and what none of it says about being foreign, is on how these figures are published.

Every figure on this page, and where it came from

22 rules for Luxembourg, each carrying the dataset, the row, the date it was read and an archived copy of that row. Ruleset sha256:7c8a1de9fc6d87cc.

• lu.ref_average_combined_rate.aw100.ty2025: Average income tax and employee social security combined at the average wage. DSD_TAX_WAGES@DF_TW_COMP / LUX AV_RITEESSC PT_WG_EARN_G / S_C0 AW100 / 2025. Read 2026-09-06 from OECD Taxing Wages, tax burden on a single person with no children.
• lu.ref_average_combined_rate.aw167.ty2025: Average income tax and employee social security combined at 167% of the average wage. DSD_TAX_WAGES@DF_TW_COMP / LUX AV_RITEESSC PT_WG_EARN_G / S_C0 AW167 / 2025. Read 2026-09-06 from OECD Taxing Wages, tax burden on a single person with no children.
• lu.ref_average_combined_rate.aw67.ty2025: Average income tax and employee social security combined at 67% of the average wage. DSD_TAX_WAGES@DF_TW_COMP / LUX AV_RITEESSC PT_WG_EARN_G / S_C0 AW67 / 2025. Read 2026-09-06 from OECD Taxing Wages, tax burden on a single person with no children.
• lu.ref_average_employee_ssc_rate.aw100.ty2025: Average employee social security rate at the average wage. DSD_TAX_WAGES@DF_TW_COMP / LUX AV_R_EMPEE_SSC PT_WG_EARN_G / S_C0 AW100 / 2025. Read 2026-09-06 from OECD Taxing Wages, tax burden on a single person with no children.
• lu.ref_average_employee_ssc_rate.aw167.ty2025: Average employee social security rate at 167% of the average wage. DSD_TAX_WAGES@DF_TW_COMP / LUX AV_R_EMPEE_SSC PT_WG_EARN_G / S_C0 AW167 / 2025. Read 2026-09-06 from OECD Taxing Wages, tax burden on a single person with no children.
• lu.ref_average_employee_ssc_rate.aw67.ty2025: Average employee social security rate at 67% of the average wage. DSD_TAX_WAGES@DF_TW_COMP / LUX AV_R_EMPEE_SSC PT_WG_EARN_G / S_C0 AW67 / 2025. Read 2026-09-06 from OECD Taxing Wages, tax burden on a single person with no children.
• lu.ref_average_income_tax_rate.aw100.ty2025: Average income tax rate at the average wage. DSD_TAX_WAGES@DF_TW_COMP / LUX AV_ITR PT_WG_EARN_G / S_C0 AW100 / 2025. Read 2026-09-06 from OECD Taxing Wages, tax burden on a single person with no children.
• lu.ref_average_income_tax_rate.aw167.ty2025: Average income tax rate at 167% of the average wage. DSD_TAX_WAGES@DF_TW_COMP / LUX AV_ITR PT_WG_EARN_G / S_C0 AW167 / 2025. Read 2026-09-06 from OECD Taxing Wages, tax burden on a single person with no children.

The remaining 14 are in the published ruleset, with the same quote and hash on each.