Luxembourg Parliament Approves 2024 Budget Despite United Opposition

Luxembourg Parliament approves 2024 budget despite a strong stance from the opposition party. 25 MPs voted against the 2024 budget.

Luxembourg lawmakers approved the 2024 state budget and its €1.9 billion deficit spending on Thursday, despite the fact that all 25 MPs from the LSAP, Déi Gréng, Déi Lénk, Pirate Party, and ADR voted against it.

However, with a 35-MP majority in the 60-seat Chamber of Deputies, the CSV-DP coalition easily passed Finance Minister Gilles Roth’s bill. The budget forecasts a 7.1% increase in state revenues to €27.5 billion this year, but the government also intends to increase spending by 7.6% to €29.4 billion.

According to Roth, the deficit of 1.2% of GDP is less than the €3.6 billion gap discussed during coalition negotiations in October.

During the budget debate, Roth objected to points raised by opposition MPs. Déi Gréng MP Sam Tanson called the new deficit a “bluff” and pressed the finance minister on where savings could be made in state spending. Roth stated that savings would come from within a number of ministries, such as renting office space rather than purchasing expensive buildings as was previously done.

Earlier on Thursday, MPs voted unanimously to approve 48 infrastructure projects, including office space for civil servants at the new ArcelorMittal headquarters on Kirchberg, which the previous government approved for €273.5 million.

In response to criticism that the budget forecast is overly reliant on economic growth, Roth stated that Luxembourg will be in recession in 2023, and that 2% growth in 2024 is lower than previous years’ estimates.
“The important thing is that we reduce the deficit, and nevertheless maintain purchasing power of the citizens via tax adjustments,” he went on to say.

Roth told parliament on Wednesday that the government intended to reform tax bracket 1a, which applies to people over the age of 65 and single parents with dependent children, next year. This would benefit some of the demographic groups most vulnerable to poverty, he said.

This week’s debate in parliament focused on the 2024 budget, with rapporteur Diane Adehm (CSV) delivering a series of recommendations on how Luxembourg can diversify its economy and attract talent and business.

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