EUROCOSTSCOUNTRY COMPARISON · UPDATED 2026-07-16
Luxembourg vs Portugal: taxes, salary and cost of living
The practical contrast between Luxembourg and Portugal becomes clearest when monthly income is tested against rent, food and mobility rather than viewed in isolation.
Luxembourg vs Portugal at a glance
| Indicator | Luxembourg | Portugal |
|---|---|---|
| Standard VAT | 17% | 23% |
| Income tax | 0-42% | 12.5-48% |
| Social contributions | 24.4% | 34.75% |
| Tax burden | 38.4% | 41.8% |
| Average monthly salary | €6,900 | €1,877 |
| Studio rent | €1,650 | €900 |
| Monthly food estimate | €420 | €300 |
| Gasoline | 1.52 €/L | 1.73 €/L |
| Electricity | 0.21 €/kWh | 0.24 €/kWh |
Income comparison in context
Luxembourg records the higher listed monthly salary. The gap is €5,023, approximately 267.6% relative to the lower figure. Within the numeric EuroCosts sample, Luxembourg ranks 3 of 27 for salary and Portugal ranks 18 of 27. The nominal advantage should be tested against local housing before it is treated as additional purchasing power.
Rent, food and the monthly budget
Portugal has the lower listed studio rent by €750, a 83.3% difference relative to the higher rent. Luxembourg sits 36 of 37 and Portugal 26 of 37 in the available low-to-high rent ranking. Portugal also has the lower food estimate, so the housing result is reinforced by groceries.
After subtracting only the listed rent and food estimates, the simplified remainder is €4,830 in Luxembourg and €677 in Portugal. This leaves €4,153 more in Luxembourg, before utilities, transport, healthcare, childcare or personal taxes not already reflected in salary.
Headline taxation: what differs
Luxembourg has the lower listed tax burden by 3.4 percentage points. Standard VAT is 17% in Luxembourg versus 23% in Portugal. Effective taxation depends on income level and household circumstances.
A practical transport check
Luxembourg has the lower listed gasoline price by €0.21 per litre. For a driver buying 50 litres a month, that headline difference is about €10.5 monthly, before insurance, parking and road charges.
Who may prefer each country?
A single professional comparing Luxembourg with Portugal should stress-test rent and take-home pay, while a family should give more weight to food, utilities and services that are not fully represented here. A company founder must separately review corporate and dividend taxation.
The most useful conclusion
Luxembourg produces the stronger simplified monthly remainder in this dataset, while Portugal leads on listed rent. The trade-off is more informative than a blanket cheapest-country label.
Sources and data references
- PwC standard VAT rates
- PwC personal income tax rates
- PwC corporate income tax rates
- EuroCosts data scope and generation process
Explore Luxembourg comparisons · Explore Portugal comparisons