The new Luxembourg coalition government has revealed its commitment to bolstering the competiveness of the country’s fund industry.

The government wants to make improvements to legal and regulatory frameworks in financial services.

Marc Saluzzi, chairman of the Association of the Luxembourg Fund Industry (Alfi), said: “The new government clearly appreciates the importance of the financial services sector to the Luxembourg economy and is committed to ensure that it remains a centre of excellence in financial services, fully compliant to international standards.”

The government said it will not increase subscription tax and will look at the fiscal regime of investment funds in order to improve the competitiveness of Luxembourg-based funds.

The government plans to lead promotional efforts to attract leading private equity funds to Luxembourg and will adopt measures to attract more front-office functions to Luxembourg, including the reform of the carried interest taxation rules.

The government also refuses to introduce a financial transaction tax at EU level.