Estonia has the most competitive tax code in the OECD
For the twelfth year in a row, the Tax Foundation has declared Estonia’s tax code the most competitive in among the countries in the Organisation for Economic Co-Operation and Development.
According to the Tax Foundation, a Washington, DC-based think tank, Estonia’s top score is driven by four positive features of its tax system.
“First, it has a 20 per cent tax rate on corporate income that is only applied to distributed profits. Second, it has a flat 20 per cent tax on individual income that does not apply to personal dividend income. Third, its property tax applies only to the value of land, rather than to the value of real property or capital. Finally, it has a territorial tax system that exempts 100 per cent of foreign profits earned by domestic corporations from domestic taxation, with few restrictions,” the Tax Foundation said.
