Are you looking for a safe and stable jurisdiction that provides considerable tax benefits to non-residents? Look no further than Luxembourg. This is a world leader in terms of GDP per capita (despite its small size) and a country that has created an excellent business environment that attracts numerous entrepreneurs from across the globe. If you are seeking a city to relocate to, Luxembourg, the country’s capital, is an excellent solution as it offers top-notch living conditions and is the wealthiest city in the world in terms of GDP per capita. If you want to know more about the state, read a more detailed article about substantial tax advantages for affluent holding companies in Luxembourg.
How Wealthy Is Luxembourg?
The 2000s were good years for Luxembourg’s economy as a lot of large companies and corporations came to the country and gave a considerable boost to its GDP. In fact, it doubled in just five years, which is a noticeable success! There are a lot of major banks and investment companies in the country, and its financial sector generates about 28% of its GDP. You will find a lot of investment funds here kept by financial institutions whose assets amount to several trillions of dollars, which is impressive. Wealthy investors and entrepreneurs from across the globe opt for Luxembourg as a place where their assets will be kept.
The country’s economy boasts a considerable degree of international transparency and a well-thought-out taxation system. The sector of financial services generates a considerable share of Luxembourg’s GDP (about one-third). During the pandemic, the country’s GDP decreased like in the majority of other states. However, it resumed its growth in 2021. The country has fully recovered and restored its status as an international trade and financial center.
Factors That Make Luxembourg Wealthy
Luxembourg is an attractive business destination, and many wealthy entrepreneurs opt for it to set up a company despite the fact that it can no longer offer some benefits of a tax haven due to the pressure put on it by the OECD and the EU. The situation was made even worse by LuxLeaks, the scandal that happened back in 2014, which showed the tax incentives provided by the government to major foreign corporations.
Luxembourg was obliged to change its laws eight years ago, and it successfully did so. The modifications are related to more stringent banking secrecy requirements and the automatic exchange of tax information.
This fact did not make the country less popular, though, and Luxembourg still attracts a great number of foreign companies, shows considerable GDP growth, and is rapidly developing its economy. The local authorities are especially interested in startups right now and mostly focus on innovative industry development.
Pro-Business Environment
Luxembourg’s healthy economic environment is simply proverbial, and it also boasts a low public debt (as compared to other European states) and a stable political structure. All these factors demonstrate why Luxembourg is a wealthy country with great potential! Its AAA rating (outlook stable) shows that the country can remain a rich country even after a major crisis that may hit it as it is ready to withstand its consequences.
Double Taxation Agreements
Luxembourg offers a benign taxation system, and this advantage is highly appreciated by foreign entrepreneurs. The country is a party to 86 double taxation agreements, including those concluded with such thriving states as China, the US, and all EU and OECD members. As a result, companies can save on taxes and invest these funds in business development.
Stable Financial System
Luxembourg is one of the leaders in the world if we look at its banking system. This fact makes it possible for the country to attract considerable investments and capital by placement of bonds on the Luxembourg Stock Exchange, increases the state assets, and makes the territory wealthy.
Luxembourg is an excellent destination for investment funds. This fact helps boost the local economy and increase the country’s GDP, and it also creates favorable conditions for major international corporations that operate in the sphere of finances and financial technologies.
Reliable Banking
Luxembourg has a high reputation when it comes to the stability of its banking system. This part of the overall financial system makes substantial contributions to the country’s GDP. The local banking sphere is highly diversified, and it offers a great number of financial services:
- Listing and post-trading services
- Management of funds
- Trust and depository services
- High-quality private banking services
- Investment and corporate banking services
Luxembourg is a European financial hub where you will find some major international banks you can take advantage of. We highly recommend opening a multicurrency bank account with one of the country’s banking institutions as it will greatly simplify the process of doing business with partners across the globe.
Living Standards in Luxembourg
If we look at the top ten immigration destinations, we are sure to find Luxembourg there – and we will hardly be surprised as the Duchy provides really high living standards. You can come here for business or life and take advantage of an excellent healthcare system and a well-developed infrastructure. Luxembourg is a multicultural country open to foreigners, and you will find a lot of foreign citizens working and living here. The GDP level and the minimum salary are the best evidence of the country’s attractive living standards, and labor remuneration is much higher here than in the majority of European countries.
Need an Alternative?
We all like to have a choice. It’s clear that Luxembourg is not the only destination where living is good, so let’s look at other countries with a high GDP that can serve as an alternative to Luxembourg:
- The Swiss Confederation
- Qatar
- Republic of Ireland
- Singapore
And if you are seeking a large country to live in, consider China or the US, the world’s largest and wealthiest economies.
You can follow the above link to discover much more about Luxembourg or talk to an expert using a live chat if you have any questions. Choosing a place for relocation may be a challenging task, but you can always rely on professional advice!
