Estonia Has World's Most Competitive Tax System
by Ulrika Lomas, Tax-News.com, Brussels
18 October 2016
Estonia has the most competitive tax system in the world due largely to its 20 percent corporate tax and "well-structured" personal income tax system, according to Washington-based fiscal think tank the Tax Foundation.
The Tax Foundation's third annual International Tax Competitiveness Index measures how well a country's tax system promotes sustainable economic growth and investment. The report looks at over 40 tax policy variables in five categories, including corporate income taxes, individual taxes, consumption taxes, property taxes, and the treatment of foreign earnings.
According to the Foundation, Estonia's position at the top of the 2016 index is predominately the result of four factors, including: "its low percent corporate tax; a well-structured, 20 percent tax on individual income; a property tax applied only to the value of land rather than the value of real property or capital; and a well-designed territorial tax system."
New Zealand and Latvia take the next two places in the index.
By contrast, France sits at the foot of the league table because of its high 33.33 percent corporate tax rate, "high and poorly structured" property taxes, and "high, progressive individual tax rates."
The United States rose one place to 31st in this year's index, but is fifth-from-bottom overall due to its high rate of corporate tax, worldwide tax system, and relatively high and poorly structured taxes on personal income, dividends, and capital gains, the Tax Foundation said.
Greece, Portugal and Italy round out the bottom five places in the index.
Tax Foundation Economist Kyle Pomerleau said: "No longer can a country levy high taxes on investment without adversely affecting its economic performance. In recent years, many countries have recognized this fact and have moved to reform their tax codes to be more competitive while raising enough revenue for government priorities. However, others have failed to do so and are falling behind the global movement."
To see today's news, click here.
Tax-News Reviews

A review and forecast of Cyprus's international business, legal and investment climate.

A review and forecast of Malta's international business, legal and investment climate.

A review and forecast of Jersey's international business, legal and investment climate.

A review of the latest budget news and government financial statements from around the world.
Tax-News+ Updates
Receive FREE daily updates from Tax-News.com, straight to
your inbox. Register Now!
For a tailored solution, choose to receive selected news updates for your preferred jurisdictions and topics, with our enhanced Tax-News+ subscriber service. Read more...
Stay Updated
Please enter your email address to join the Tax-News.com mailing list. View previous newsletters.
By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.
To manage your mailing list preferences, please click here »
Network Blogs and Features
- economic forecasting is a hazardous occupation »
- Cyprus: An ideal gateway »
- Three legs are steadier than two left feet »
- How do I expand my existing business to Ireland and avail of the 12.5% Corporate Tax Rate? »
- UK Experiences a Rise in the Number of British Expats in the UAE Investing in Property »
- no regulation without taxation »
- University of Tasmania - Study abroad & Exchange »
- Top Tips for Overseas Investors looking to attract the Best Tenants »
- A Guide to Helping your Children during your Move Abroad »
- Update On The Common Reporting Standard »
- Sometimes, you just can't win »
- Western Michigan University and Why You Should Go There »
- Dubai Free Zone Company Formation - General Free Zones/DMCC »
- My Encounter with St. Leo University »