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Denmark vs Luxembourg Tax Comparison
Side-by-side comparison of tax rates and systems
Tax Rate Comparison
Rate Comparison
Top Income Tax
Denmark55.9%
Luxembourg42%Lower
Corporate Tax
Denmark22%Lower
Luxembourg23.9%
Capital Gains
Denmark42%
Luxembourg21%Lower
VAT / Sales Tax
Denmark25%
Luxembourg17%Lower
| Category | Denmark | Luxembourg |
|---|---|---|
| Tax System | Progressive | Progressive |
| Top Income Tax | 55.9% | 42% |
| Corporate Tax | 22% | 23.9% |
| Capital Gains | 42% | 21% |
| VAT / Sales Tax | 25% | 17% |
| Crypto Tax | Yes | Yes |
| Wealth Tax | No | No |
| Tax Treaties | 75 | 85 |
| Currency | DKK | EUR |
The bottom line: Denmark vs Luxembourg
Luxembourg has the lower headline rate on 3 of the four main taxes (income, corporate, capital gains and VAT), making it the lighter-taxed of the two on paper. Denmark runs a progressive tax system, while Luxembourg uses a progressive one. Luxembourg has the wider tax-treaty network (85 agreements), which can reduce withholding tax on cross-border income.
- Income tax: Luxembourg is lower (55.9% vs 42%)
- Corporate tax: Denmark is lower (22% vs 23.9%)
- Capital gains tax: Luxembourg is lower (42% vs 21%)
- VAT / sales tax: Luxembourg is lower (25% vs 17%)