Luxembourg as a Strategic Base
In 2025, exporters of industrial machinery and tools—such as CNC machines, hydraulic presses, metal cutting equipment, and laser tools—are actively setting up commercial companies in Luxembourg to streamline European operations. What attracts them isn’t just low taxation, but also flexible corporate vehicles and an efficient VAT framework.
Why Exporters Move Operations to Luxembourg
The European market remains a key growth area for US and German machinery exporters. In 2024, the EU imported over €61 billion worth of industrial machinery and mechanical appliances from outside the EU. The US and Germany are among the top five exporters to the bloc, particularly in the automation, energy infrastructure, and metalworking equipment categories.
To increase profit margins, exporters are turning to Luxembourg. The total corporate tax burden in Luxembourg City is 23.87% in 2025, which includes corporate income tax, municipal business tax, and a solidarity surtax. That’s significantly lower than Germany’s combined tax rate, which exceeds 29.8% in many regions.
Corporate Vehicles for Exporters
| Company Type | Minimum Capital | Suitable For |
| SARL-S | €1 | Small exporters testing EU markets |
| SARL | €12,000 | Mid-sized exporters with warehousing needs |
| SA | €30,000 | Large exporters and EU distribution hubs |
German tool manufacturers often choose SARLs to centralize EU sales. US exporters tend to start with SARL-S structures while validating market demand.
VAT and Trading Scheme Optimization
Exporters benefit from Luxembourg’s fast-track VAT registration and EU intra-community supply rules. Goods moved from a Luxembourg warehouse to EU clients are treated as exempt from VAT under the EU reverse charge mechanism—freeing up cash flow and reducing compliance headaches.
With the right trading scheme, US exporters shipping robotics or production line tools from Asia can import them via Luxembourg, then re-export under EU rules, leveraging efficient customs clearance.
Streamlined Setup with Business Permits
Setting up a Luxembourg entity requires a business permit from the Ministry of the Economy, proof of qualifications (especially for regulated technical sectors), and RCS registration. Damalion offers local resident directors services. Thanks to digital filings, companies are operational in 2–4 weeks on average.
Damalion: Your Strategic Partner in Europe
Damalion helps US and German exporters of industrial machinery and tools create tax-optimized Luxembourg companies. From choosing the right structure to obtaining permits and managing VAT, we provide hands-on support at every step.
Partner with Damalion to register your Luxembourg company and gain a cost-efficient foothold in the EU.
