Ranking of countries by the level of tax burden on business 2019
• The list of the most profitable countries in terms of business development was compiled by Tax Foundations, a non-profit tax organization. For more than 80 years, its experts have been calculating who paid where, when and how much in taxes.
To compile rating of countries by the level of tax burden on business business tax rates were studied in more than 200 countries around the world. And it turned out that over the past 30 years, the corporate tax rate has been constantly decreasing.
- In 1980, the average income tax rate was 46,63%.
- Now the average for 208 countries is approximately 23,03%.
- Even the United States, traditionally of the view that business should pay (for a long time, the tax rate there was one of the highest in the world), loosened its tax grip a little. Now they are closer to the middle of the list.
Countries with the lowest tax burden on business
|Bosnia and Herzegovina||10%|
|The former Yugoslav Republic of Macedonia||10%|
|vOperating systemtochnii timor||10%|
|Republic of Kosovo||10%|
• Europe as a whole is considered one of the most favorable regions for business in terms of tax burden. The average income tax there is 18,38%. As for Cyprus, it has long been considered a kind of Mecca of the rich, where serious businessmen launder money.
• True, the Cypriots themselves vehemently protest against such a characterization and claim that they attract businessmen from all over the world with an exceptionally favorable tax regime and an facilitated process of starting their own business. And the taxation of the country fully complies with the requirements of the European Union and the OECD.
• In addition to Cyprus, Ireland and Liechtenstein have the same business tax rate. However, Ireland has its own specifics: 12,5% is taken there only from income received from trade. But if an entrepreneur produces something or supplies services, then the rate there is already more serious – 25%.
• Next in the ranking of places with the lowest tax burden on businesses is Macau, a legacy of the colonial era that China was able to return only at the very end of the last century.
• This is the second so-called special administrative region of China after Hong Kong. That is, a territory that in many respects remains independent. For example, Macau has its own currency. And in 2001, a law was passed legalizing gambling. Thanks to him, at the moment, the "Chinese Las Vegas" is one of the leading gaming centers not only in Asia, but throughout the world.
• And here is the first post-Soviet country in the list of states with the lowest tax burden on business in 2019. The corporate tax rate in Moldova is only 12%, but over the past 14 years it has fluctuated more than once.
• The highest (20%) was recorded in 2004, and the lowest (0%) in 2008. Perhaps, thanks to such a low rate, the country's foreign trade is growing stronger. Over the past couple of years, its volume has increased by 18,4%.
• This is a tiny state, located on a small coral island in the Pacific Ocean, with a population of only 10 thousand people. The country does not even have its own capital, and it is not needed with an area of 21 km2.
• After the barbaric mining of phosphorites, the island is experiencing a severe environmental disaster, and in an attempt to make money in the early 90s of the last century, it was decided to turn Nauru into an offshore zone. It became so popular that the anti-money laundering financial institution was forced to ban the creation of offshore banks on the island. However, to this day, the corporate tax rate in Nauru remains one of the lowest in the world.
• An important part of Paraguay's economy is the so-called "Maquila" regime – this is when large foreign companies organize assembly plants in Latin America, taking advantage of the low cost of local labor and the prospects of contract hourly wages. Of course, no sick leave and vacations for employees are provided.
• This is done mainly by businessmen from the USA. “Why them?” you might ask, looking at the map and noting that Paraguay is farther from the US than Mexico, where such businesses are very common. It's very simple: the tax rate in Paraguay is the lowest in all of Latin America.
What do the former Soviet republics of the USSR have in common, the safest country in the worldexporter of oil and gas, and a small island nation in the Indian Ocean? Only one thing – a low corporate tax rate. The first country is Kyrgyzstan, and the second two are Qatar and East Timor.
• The tiny state, sandwiched between France and Spain, compares favorably with its neighbors with its tax policy. For example, Andorrans introduced an income tax only in 2015 and then under pressure from the European Union. However, this small country is still considered an ideal starting point for expats who dream of making money. There is no property tax, gift tax, or even inheritance tax, and income tax is charged only on the sale of property. Moreover, you can become a citizen of the country only by creating an enterprise in the country, or by investing in an existing one.
• In addition to Andorra, Bulgaria, one of the countries most beloved by European entrepreneurs, can boast of a ten percent business tax. In addition to the low tax rate (by the way, for individuals it is the same 10%), businessmen are attracted by its convenient geographical location, developed infrastructure and low wages traditional for the countries of the former Eastern Bloc.
• Despite the fact that Hungary is still a country dependent on the European Union and its subsidies, the forecasts for its development are the most favorable. The government of Orban (the country's prime minister) managed to achieve GDP growth and an overall improvement in the well-being of the population.
• Perhaps one of the lowest corporate tax rates in Europe played a role in this. The Hungarian government not only attracts foreign companies, but also supports the growth of its own small businesses. And the labor market is full of qualified specialists at a lower price than usual in Europe.
• Montenegro, a small Balkan state, is also taking an example from Hungary, trying to survive by attracting foreign investors. It is favorably distinguished by both the low rate of business tax and the transparency of the tax system. Montenegro is simply forced to behave decently, because otherwise it will not be allowed into the EU, which the country is trying to achieve with all its might.
• Such a pleasant figure for businessmen applies only to residents – residents of Turkmenistan. It is their businesses that are taxed at 8%. For individual resident entrepreneurs, the rate is even lower and amounts to only 2%.
• But foreigners will have to pay more. For them, the corporate tax rate is 20% in accordance with the Petroleum Law.
• Such a low corporate tax rate is a kind of "general temperature in the hospital." In Uzbekistan, the rate is different for different enterprises.
- Standard – 12%.
- For commercial banks – 20% (it was also reduced from 22%, as it was last year).
- But mobile operators will have to pay more – for them the rate has increased from 14 to 20%.
- From a tax point of view, it is slightly more profitable to engage in small business in Uzbekistan. For him, the tax rate decreased to 4%.
Which countries have the highest tax burden on businesses?
|United Arab Emirates||55%|
|Democratic Republic of the Congo||35%|
• The United Arab Emirates is leading here with a terrifying figure for a businessman – 55%. Let us clarify that only foreign companies involved in the extraction and processing of oil, as well as foreign bankers, are subject to such a tax rate. But the attitude towards their entrepreneurs in the UAE is much softer.
• Then there are developing countries with unstable economies located in Africa and South America. Their tax rate is from 50 to 33%. Of the large, dynamically developing countries, India and Brazil have the highest tax rate (35% and 34% respectively).
• There are even two European countries in the list of "stingy" countries – France (rate 34,43%) and Malta (35%). It is no wonder that the French prefer to organize business somewhere outside their own country.
Countries where business is not taxed
- Bermuda shorts
- kaimanovi Operating systemtrova
- Isle Of Man
- Turks and Caicos Islands
- British Virgin Islands
Corporate taxes 2019
• Russian corporate taxes and tax liabilities vary depending on the business structure. Here is what the table of the tax burden looks like in 2019, depending on various types of economic activity, according to the Federal Tax Service.
|Type of economic activity (according to OKVED-2)||Taxes, %|
|Agriculture, forestry, hunting, fishing, fish farming – total||4.3|
|crop and animal husbandry, hunting and the provision of related services in these areas||3.5|
|forestry and logging||7.5|
|fishing, fish farming||7.9|
|Mining – total||36.7|
|extraction of fuel and energy minerals -total||45.4|
|extraction of minerals, except for fuel and energy||18.8|
|Manufacturing industries – total||8.2|
|production of food products, beverages, tobacco products||28.2|
|production of textiles, clothing||8.1|
|manufacture of leather and leather goods||7.9|
|woodworking and manufacture of articles of wood and cork, except furniture, manufacture of articles of straw and plaiting materials||2|
|manufacture of paper and paper products||4.4|
|printing and copying of information media||9.2|
|production of coke and petroleum products||5.1|
|production of chemicals and chemical products||1.9|
|production of medicines and materials used for medical purposes||6.9|
|production of rubber and plastic products||6.3|
|production of other non-metallic mineral products||8.9|
|metallurgical production and production of finished metal products, except for machinery and equipment||4.4|
|production of machinery and equipment, not included in other groups||8.8|
|manufacture of electrical equipment, manufacture of computers, electronic and optical products||9.9|
|manufacture of computers, electronic and optical products||12.5|
|manufacture of electrical equipment||6.7|
|manufacture of other vehicles and equipment||4.7|
|manufacture of motor vehicles, trailers and semi-trailers||5.1|
|Provision of electricity, gas and steam; air conditioning – total||6.8|
|production, transmission and distribution of electricity||8.1|
|production and distribution of gaseous fuels||1.3|
|production, transmission and distribution of steam and hot water; air conditioning||6.5|
|Water supply, sewerage, organization of collection and disposal of waste, activities and elimination of pollution – total||8.4|
|Wholesale and retail trade; repair of motor vehicles and motorcycles – total||3.2|
|wholesale and retail trade in motor vehicles and motorcycles and their repair||2.7|
|wholesale trade, except for wholesale of motor vehicles and motorcycles||3.1|
|retail trade, except for motor vehicles and motorcycles||3.6|
|Activities of hotels and catering establishments – total||9.5|
|Transportation and storage -total||6.8|
|rail transport activities: intercity and international passenger and freight traffic||8.5|
|pipeline transport activities||4.5|
|water transport activity||9.3|
|air and space transport activities||-|
|postal and courier activities||14.4|
|Activities in the field of information and communication – total||16.4|
|Real estate activities||21.3|
|Activities administrative and related additional services||15.4|