Luxembourg going green

In 2017, new rules governing perquisites will have one goal: to go green. CO2 emissions from fleet cars will have a significant tax impact. Alphabet is here to find the best solution.

Since the start of 2016, the Grand Duchy's car market has seen a return to petrol and hybrid solutions and even the rise of electric cars. However, diesel remains the fuel of choice for 8 out of 10 company cars. Diesel will undoubtedly lose a little ground in 2017 with the development of perquisites. 1 g too much CO2 will lead to an increase in road tax. And at equal emissions, petrol will always have the edge on diesel.


Reassessment of fixed perquisites where company cars are concerned is not yet on the cards, but the calculation table is virtually definitive. With the joint efforts of the federations FLLV (hirers), Fégarlux (garage owners) and Adal (distributors), legislation is less harsh than it used to be. However, with the current situation being 1.5% of the purchase value of a new vehicle, including VAT, the percentage will change according to emissions and engine type, and it may be as high as 1.8% for a diesel. At under 50 g of CO2/km, on the face of it, rechargeable hybrid cars are competitive, but not necessarily.

Cross-border and Luxembourg

Jean-Paul Biordi, Country Manager at Alphabet Luxembourg recalls that engine choice must above all be down to average mileage and distances covered. "The high number of people who cross the Grand Duchy's border, covering long distances, will still opt for diesel". Yet "Residents of Luxembourg may opt for petrol or a (rechargeable) hybrid, or even an electric vehicle if they travel little in the company car". It is worth noting that by 2020, the authorities have planned to provide 800 public charging points.

Personal solutions

Alphabet may already advise its clients on the most suitable solutions based on the table drawn up for next year. They are drawn up on a case-by-case basis, according to changes in tax. The purpose being to offer the best proposal given individual requirements. Alphabet has the answers to adapting your fleet to users' customs, your convictions and fixed perquisites in 2017.

Reform of major lines

At between 111 g and 150 g of CO2/km, perquisites including diesel cars will always be taxed at 1.5% of their purchase value plus VAT. Whereas with a petrol engine, the quota will be 1.3%. The tax scale will be staged at between 0.5% for electric or hydrogen cars and 1.8% for diesels emitting more than 150 g of CO2/km. By opting for a petrol engine emitting 100 g of CO2/km, tax will be 1%, or the same as a diesel rechargeable hybrid emitting less than 50 g of CO2/km. Whereas a petrol rechargeable hybrid will in fact be 0.8%. See the table (provisional).

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