It is said in the article that moving a company’s operations to Estonia is an easy undertaking. There is less bureaucracy in Estonia. The procedure for establishing a company and the taxation system are both easy and clear. There is no need to struggle with tax cards, changing tax rates, determining activity regions and appointing responsible persons, etc.
After accession to the European Union and the changeover to the euro, the planned tax changes in Finland that do not favour small and medium-sized enterprises have now given an additional incentive to companies to leave for Estonia.
In Estonia, employee-related taxes are the same for everybody: the income tax is 21% and an employer also has to pay 33% social tax, 1% unemployment insurance and 2% pension insurance.
The Estonian taxation system supports profit-earning, growing companies. No taxes are paid on deposited and reinvested revenue. A company only has to pay 21% income tax when paying out dividends.
For example, production, IT and agricultural companies are brought from Finland to Estonia and construction and service companies mainly go from Estonia to Finland. Tomi Bosnjak, Managing Director of Leinonen Estonia, also mentions in the article the tendency of many well- managed companies in Estonia to move from Estonia to Finland, whereas companies sometimes come from Finland to Estonia just to test the waters.
If a warehouse or some employees of a company moving to Estonia stay in Finland, the associated taxes will be collected in Finland.
If a profit-earning company has moved entirely to Estonia and the business operations continue as before, smaller companies will also benefit from the taxation system by saving tens of thousands of euros annually.
The article can be found at: http://www.hs.fi/talous/Yritykset+karkaavat+Viroon/a1368242750540
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