Car tax in Luxembourg: 30 euros for EVs and what your fleet still pays

In Luxembourg, a fully electric car pays the annual vehicle tax (taxe sur les véhicules automoteurs) at the legal minimum: €30 a year. Diesel and petrol cars pay according to their CO2 emissions, usually between €60 and €250 a year for a typical company car.

This guide is for fleet managers and finance teams. It explains the formula with worked examples, where to find the CO2 value, how the tax is paid and refunded, who pays under a lease, what changes for cross-border employees (including the Belgian vignette planned for 2027), and why the tax saving of an electric fleet is small next to the energy and benefit-in-kind savings. Energy is where Voltaback works: it reimburses home charging at the real kWh price of each driver's contract.

Luxembourg car tax at a glance

The annual vehicle tax, often simply called the "vignette" or road tax, is due on every vehicle registered in Luxembourg. It is paid to the central cash office of the Customs and Excise Agency (Administration des douanes et accises), and the vignette is the proof of payment.

Three things to know:

• The registration holder pays, whether a private person or a company.
• It is an annual tax, refunded pro rata if the car is sold or taken off the road before the vignette expires.
• For cars first registered since 1 January 2001, it is based on CO2 emissions. Older cars are taxed on engine size.

Cross-border workers who drive a car registered in their country of residence do not pay this Luxembourg tax; they pay the vehicle tax of their own country. Source: Guichet.lu, vehicle tax.

How the tax is calculated: a x b x c

For a passenger car registered since 2001, the annual tax in euros is the product of three factors:

• a: CO2 emissions in g/km, as stated on the European certificate of conformity (COC);
• b: a multiplier of 0.9 for diesel engines and 0.6 for all other engines;
• c: a progression factor of 0.5 up to 90 g/km, rising by 0.1 for each started band of 10 g/km above that (91 to 100 g/km: 0.6; 101 to 110 g/km: 0.7; and so on).

The minimum annual tax is €30. Since the switch to the WLTP test cycle, cars first registered from 1 March 2020 are taxed on their WLTP value, using the same formula. Sources: Ministry of Mobility, WLTP release, ACL car tax calculator.

Worked examples

Because both a and c rise with CO2, the tax grows faster than emissions: a diesel at 185 g/km pays about twice as much as one at 135 g/km, while emitting only about a third more. Two rows (101 and 203 g/km) match the model examples published by Luxtoday, which confirms the reading of the formula. Hybrids are taxed according to their fuel, but a plug-in hybrid with a low WLTP value often falls back to the €30 minimum.

Where to find the CO2 value

The value that counts is the CO2 figure on the car's certificate of conformity (COC): the WLTP value for cars first registered from 1 March 2020, the older NEDC value before that. It also appears on the registration certificate. For a plug-in hybrid, it is the weighted combined value that takes electric range into account, which is why many models are below 50 g/km. The ACL online calculator gives a quick check.

Cars before 2001, vans and trailers

Passenger cars first registered before 1 January 2001 are still taxed on engine size. Vans, lorries, tractor units and trailers pay according to vehicle type, unladen weight, maximum authorised weight, number of axles and suspension. Trade and service fleets with vans should therefore look at the customs tables separately: the CO2 formula does not apply to them.

Electric cars: €30 a year, with no end date

A battery electric or hydrogen fuel cell car has no tailpipe CO2. The formula gives zero, so the €30 minimum applies every year for the whole life of the car. Source: ACEA, Electric cars: tax benefits and incentives 2026.

There is no time-limited exemption to track and no price threshold, unlike in several neighbouring countries. For a fleet budget, it is an almost fixed, predictable line.

Payment, vignette and refund

The tax is collected once a year. The Customs and Excise Agency sends the registration holder a payment request; once paid, the vignette follows and belongs with the vehicle papers.

• Electronic delivery: if you sign up to eDelivery in MyGuichet.lu, the payment request and the vignette arrive in your private space instead of by post. The email notification deliberately contains no link; you log in to the portal directly.
• Sale or deregistration: the tax is refunded pro rata for the unused part of the year. Deregistration is done at the SNCA, and the vignette is sent back with bank details to the vehicle tax revenue office.
• Exemptions: among others, vehicles of the State, municipalities and public-interest bodies, agricultural and forestry vehicles, and cars used to carry people with disabilities.

For a fleet that renews cars during the year, this means the tax follows the vehicle to the day, not the calendar year. Source: Guichet.lu, vehicle tax for individuals.

What else is due when a car is registered

The annual tax is not the only charge around a vehicle. One-off items come on top at registration, whatever the powertrain:

The Klimabonus Mobilitéit grant for a new electric car is €6,000 at up to 16 kWh per 100 km and €3,000 up to 18 kWh (or up to 20 kWh with at most 150 kW). Its extension to mid-2030 is in bill no. 8725, still going through Parliament; check its status before each order. Sources: Luxtoday, car purchase taxes in Luxembourg, Council of State, opinion on bill 8725.

No separate company car tax in Luxembourg

International groups often assume otherwise, so it is worth saying clearly: Luxembourg has no annual tax specific to company cars, paid by the employer per vehicle according to CO2 or pollutant emissions.

A company car pays the same vehicle tax as a private car. Company car taxation works through another channel: the benefit in kind (BIK) taxed in the driver's hands, calculated each month as a percentage of the list price. That is where the large gap between electric and combustion cars sits, as explained in our article on electric company car taxation.

Who pays the tax on a leased car?

Under an operating lease, the car is registered in the leasing company's name. As registration holder, the lessor pays the vehicle tax.

In practice, the lessor passes it on in the monthly rental, together with insurance, maintenance and tyres. For an electric car, that is €2.50 a month; for a diesel at 155 g/km, just under €14 a month. The difference is real but marginal in a rental of several hundred euros.

Cars the company owns

When the company buys its cars, it is the registration holder and receives the payment requests directly. Assign each vignette in the accounts to the vehicle and its cost centre: the tax then stays visible in the cost per vehicle, and no pro rata refund is lost on a sale or deregistration. In a mixed fleet of leased and owned cars, keep one list of all vehicles with their CO2 value, tax and registration holder.

For the rest of lease taxation (VAT on rentals, deductibility, BIK), see our article on leasing an electric company car in Luxembourg.

Cross-border employees: which plates, which tax?

About 49 % of employees in Luxembourg are cross-border workers living in Belgium, Germany or France. Their company car is usually registered in Luxembourg, in the name of the employer or the lessor. Source: IGSS employment dashboard, March 2026.

Belgian residents

A Belgian resident does not need to register a Luxembourg-registered company car in Belgium if three conditions are met: the car is used for work and only incidentally for private purposes, it is provided by an employer established in Luxembourg, and the driver has an employment contract with that employer. The driver must be able to show the contract at a roadside check. The official page dates from 2018 and is marked "being updated", so ask your lessor to confirm. Source: Guichet.lu, company cars and Belgian residents.

The Belgian vignette planned for May 2027

Belgium plans a digital road vignette from 1 May 2027, for cars and vans under 3.5 tonnes, whether registered in Belgium or abroad. Announced prices are €90 a year for a zero-emission vehicle, €100 for Euro 4 and newer and €125 for older cars, with short-term passes. Luxembourg asked for a border zone or an exemption for cross-border workers; at the time of writing, none has been granted and the Walloon text has only passed first reading.

For a fleet, this would be a new line for every Luxembourg-registered company car regularly driven on designated Belgian roads, in practice those of Belgian-resident drivers. Decide in the car policy who pays it, and budget it with the lessor. Source: Paperjam, Belgian road tax sticker: no exemption for Luxembourg.

German and French residents

For cross-border employees living in Germany or France, using a Luxembourg-registered company car is also governed by the rules of their country of residence, which we do not cover here. For the vehicle tax, the key point is simple: it stays due in Luxembourg from the registration holder, wherever the driver lives.

Over the life of the car: one company car over four years

For a decision per vehicle, the full holding period counts. Here is a comparison over a typical four-year lease, with a €50,000 list price in both cases:

The vehicle tax gap is €366 over four years. The benefit-in-kind gap is €36,000 less taxable income for the driver. That shows where electrification is felt by employees: in net pay, not on the vignette.

Worked example: 50 electric cars versus 50 diesels

Take a fleet of 50 company cars, each driving 20,000 km a year.

The tax saving is €4,575 a year for the whole fleet. The energy saving is about €77,640 a year, some 17 times more.

Assumptions: diesel at about €2.05 a litre, national average in late October 2026; EVs charged 80 % at home (2,880 kWh at about €0.19 per kWh at night) and 20 % on public chargers (720 kWh at about €0.50). Diesel price source: fuel-prices.eu, Luxembourg, week of 19 to 26 October 2026.

The same car, driven by a cross-border employee

The energy line changes with the driver's home. A Belgian-resident driver on a single-rate meter pays about €0.33 per kWh: the home share then costs about €950 instead of €547, so about €1,310 a year in total. That is still about half the diesel, but it shows why one Luxembourg price for every driver does not work. To run this with your own mileage and home-charging share, use our fleet home-charging cost simulator.

The real saving is energy and benefit in kind

Vehicle tax is the most visible line and the smallest. Two others weigh far more.

The driver's benefit in kind

An electric company car ordered and registered within the current deadlines is valued at 0.5 % or 0.6 % of the list price per month, against 2 % for combustion and hybrid cars registered since 2025. For a €50,000 car, that is €250 a month instead of €1,000. Conditions are detailed in our article on the benefit in kind of an electric company car.

Energy, provided you manage it

The example above assumes home charging is reimbursed at the right price. In real fleets it rarely is. A single monthly allowance overpays some drivers and underpays others, especially when half the drivers live outside Luxembourg.

The marginal price of a charged kWh is about €0.19 at night in Luxembourg, but about €0.24 at night in Belgium on a dual-rate meter, €0.33 on a single rate, and about €0.32 in Germany. Reimbursing each driver at their own contract price is the only neutral method, and in practice, according to the Grand-Ducal regulation of 23 December 2016, electricity reimbursed at measured real cost stays covered by the company car's flat-rate benefit in kind.

That is what Voltaback does: the kWh charged at home are read from the connected car (more than 48 brands), with no box, and valued at each driver's contract price. Voltaback relies on the home's MID-certified meter, not on a standalone cable meter, and its measurement is audited by an independent third party (1.22 % relative error). For the full cost picture, read our article on fleet total cost of ownership.

Plug-in hybrids: low tax, high benefit in kind

The plug-in hybrid is where vehicle tax and benefit in kind diverge most. For the vehicle tax, it often lands on the €30 minimum thanks to its low weighted WLTP value, like an electric car. For the benefit in kind, it has been valued like a combustion car since 2025, at 2 % of the list price per month.

A draft Grand-Ducal regulation, approved by the Government Council on 24 July 2026, plans a 1 % rate from 2027 to 2030 for plug-in hybrids at up to 50 g CO2/km and extends the 0.5 % and 0.6 % electric rates to the end of 2030. Until it is published in the Mémorial, it remains a draft: plan 2027 orders with both scenarios. Source: Klima-Agence, benefits in kind for company cars.

Energy comes on top: a plug-in hybrid that is rarely charged runs on petrol and loses its advantage entirely. If you keep plug-in hybrids in the fleet, measure how much is actually driven on electricity.

Five checks for your fleet

1. List the tax per car from the WLTP CO2 on the certificate of conformity, so you know the exact line your lessor recharges.
2. Review plug-in hybrids: many pay only €30, but their BIK stays at 2 % for now, and their electric share drives their energy cost.
3. Check Belgian-resident drivers: Luxembourg employment contract on hand, private use only incidental, and the 2027 Belgian vignette budgeted.
4. Keep owned cars visible: one vignette per vehicle and cost centre, refunds claimed on every sale.
5. Measure home charging instead of paying a flat allowance: this is the line where electrification pays off or not.

To plan the transition of the whole fleet, see our guide to fleet electrification.

Cut the line that really matters

Going electric lowers vehicle tax by a few dozen euros per car. Reimbursing home charging at measured real cost, at the contract price of each resident or cross-border driver, makes a difference of hundreds of euros per car each year.

Voltaback is 100 % software with no hardware, ISO 27001 certified since 2 December 2025 and GDPR compliant: the employer never receives drivers' geolocation. Each month you get an export ready to import into your payroll software.

Talk to our team to put a figure on home charging for your fleet.