Foreign investors interested in opening an investment fund should know that Luxembourg is one of the most reliable economies. Recently, the state reconfirmed its position, as Luxembourg’s credit rating is established at AAA, which is the highest distinction provided by rating agencies. The main pillars on which the study was conducted refer to public finances and governmental debt. Our team of financial experts can provide more information on the most important aspects of the local economy.
The characteristics of the AAA rating, awarded to Luxembourg
The rating recently received by Luxembourg was offered by the rating agency Standard &Poor’s; at the same time, it is important to know that Luxembourg received similar distinctions offered by other important credit rating agencies, which confirms the stability of the country, by applying effective management strategies through its institutions.
The AAA rating is awarded for long-term issue credit ratings and it designates the highest distinction offered to a country. It implies that the respective country is able to meet the legal and financial requirements for its financial commitments; our team of financial consultants can provide more details on the specifics of the rating.
Long-term issue credit ratings refer to the following aspects:
• the likelihood of payment;
• the nature of the financial obligations to which the country is currently involved;
• the protection in terms of bankruptcy or other situations specified by the bankruptcy legislation.
Investment funds in Luxembourg
The local economy provides one of the best financial centers in the world. Luxembourg’s economy is mainly based on the financial sector and the local authorities provide solid legal and taxation systems.
The local taxation system available for investment funds is appealing to local and foreign investors due to a set of tax exemptions, applicable to the following:
• tax exemption on income and capital gains;
• full exemption from withholding tax and for wealth tax.
However, the investment funds are required to pay a subscription tax. It is important to know that the local legislation provides a regulatory framework under which Islamic investors can operate on the investment market respecting the rules of the Sharia, applicable to such actions.
Persons interested in the investment opportunities which can arise on the local market can contact our team of financial representatives for more details.