Gilles Roth, Luxembourg’s new finance minister, is seen addressing the 2023 Finance Awards, held at the Casino 2000 in Mondorf-les-Bains, 21 November 2023. Photo: Maison Moderne

Gilles Roth, Luxembourg’s new finance minister, is seen addressing the 2023 Finance Awards, held at the Casino 2000 in Mondorf-les-Bains, 21 November 2023. Photo: Maison Moderne

Gilles Roth, the grand duchy’s new finance minister, has told financial industry leaders that he will advocate for the sector.

The government will push for tax reforms to entice international finance firms and workers, Luxembourg’s new finance minister (CSV) said in his first public speech since taking office.

Roth was addressing the 2023 Finance Awards, organised by Paperjam+Delano and Luxembourg for Finance, attended by roughly 500 financial sector executives, on Tuesday.

It was his third working day as finance minister, Roth noted, but already the second time he had spoken to a financial sector audience, after participating in Luxembourg for Finance’s earlier in the day. “I hope it shows the financial sector is a priority of the government.”

In his new role, Roth said his objectives are to “ensure the sustainability of our public finances, restore purchasing power to households, ensure the competitiveness of our companies and further improve the attractiveness of our financial centre.” His priorities as finance minister are maintaining financial stability and the country’s AAA credit rating, addressing the current purchasing power and housing market challenges, and ensuring Luxembourg’s competitive advance in the financial sector.

He reminded the audience that Luxembourg’s financial centre is the engine of economic growth and substantial source of revenues for the state, and noted that he expects a “strong collaboration” between the public and private sector. “The biggest risk that we are facing as a financial centre--and also as a country--is complacency,” cautioned Roth.  

To make the country more attractive for international professionals, Roth said he will form a high committee for talent attraction and development and aimed to revise the profit sharing and expat tax regimes. He also noted his commitment to tackle the issue from various angles, including immigration, taxation, housing, schooling, transportation and infrastructure.

To appeal to financial firms, he will explore reducing the subscription tax for actively managed ETFs and for sustainable investment funds, and wanted to bring Luxembourg’s corporate income and municipal business tax rates into the OECD average.

Roth said he wanted Luxembourg’s financial sector to continue climbing up the value chain, pointing to recent successes in the private asset funds and digital assets, and burgeoning corporate banking activity. There are “growth opportunities for our financial centre,” he stated, and the government and industry “need to work together.”

As competitiveness relies on the country’s voice being heard in Brussels, Roth assured participants that he will continue to “defend cross-border financial services within the EU.” He intends to contribute to a more competitive and resilient EU economy by supporting a “strong European financial sector” and a capital markets union that will be built, he thinks,  on the strengths of EU financial centres like Luxembourg.