Reliance on finance sector too high says Frieden

(CS) The past year brought a ten percent increase in tax revenue compared to 2010, finance minister Luc Frieden announced on Friday, with the VAT as the main factor for the rise.

The 11.6 billion euros in tax revenues were also around 5% higher than calculated in the budget. However, as the expenses for the year will not be fully known until March 2012, Frieden was hesitant to draw any final conclusions on the balance of the budget.

As of December 2011 the state expense lies at 11.5 billion euros.

Frieden highlighted that the electronic market in Luxembourg, with companies such as Amazon, brought 550 million euros into the Grand Duchy's coffers. The funds industry paid some 620 million euros in taxes.

The finance minister was critical of the dependency of Luxembourg on the finance sector as it now accounts for 38% of tax revenue in Luxembourg, and emphasised the need for measures to diversify the country's economy.