While most of Europe is loudly asking for a fee of taxes of 45%, there is a handful of countries that consider profits as the delicate flowers of the capital and cultivate them with a tax of 9% and a bureaucratic simplicity. The most favorable country for taxes in the EU? Discover Hungary, Bulgaria and their bizarre but incredibly attractive tax reality.
The most favorable country for taxes in the EU? This is certainly not Slovenia. If your company had feelings, as soon as he arrived in Slovenia he would collapse on the ground and cry. Not because we have no beautiful mountains, but because the taxation here is not exactly friendly. While elsewhere the digital nomads enjoy the sun and a 10% tax rate, we are still discussing whether a 50% tax is just or excessive. But just talk about us: let’s take a look at which European country is a tax paradise masked by EU bureaucrats.
Hungary – dictatorial charm with 9 % tax
Yes, you read well. Hungary, that country that likes to discuss sovereignty while squeezing European subsidies, has the tax rate on the lowest EU companies: solo 9 %. The income tax is also moderate: Fixed tax 15 %. If you are a digital nomad, they kindly offer you theirs White paper – A visa that allows you to drink a cappuccino in Budapest while your startup is peacefully breathing fiscal freedom. And yes, the VAT is equal to 27 %, which means that you will pay the sandwich as you would do with cryptocurrencies, but who cares, until you keep most of the profit. In a sense, it is the most favorable EU country in tax terms: if not favorable, at least friendly.
Bulgaria – where the tax scale is also socialist and egalitarian
For those who prefer the Black Sea coast to Paprikoš, that’s Bulgaria. 10 % income tax. 10 % profits on profits. 20 % VAT. It is almost no claim: only a raw and naked capitalism with a touch of Eastern Europe. Starting an activity is faster than crossing the Schengen border (unless you are a truck driver). It is not a paradise for luxury, but if for you a sheet of calculation Excel is more important than the view of the Eiffel Tower, then Sofia is the right choice.
Malta – I am 35 %, I pay 5 %. Magic!
Malta is a kind of illusionistic show by Tax Houdini. Officially: 35 % of profits. Unofficially: after the return, the state often finds itself with alone 5 %. Yes, you felt good. If you have a holding company, a company with a pinch of creativity and a lawyer who knows three gaps in the law, Malta will become your favorite island, immediately after Mykonos. But be careful: European institutions look at the profits that come out of their coffers through the Mediterranean with a certain discontent. If this does not disturb you, do it as well! With a good tax lawyer: the most favorable country for taxes in the EU.
Cyprus – Sun, tax exemptions and taxation for anyone
Cyprus not only offers heavenly beaches, but also a heavenly tax policy: 12.5 % Income tax, exemptions for dividends, capital gains and interests (if you are a “non-ten”, or a resident not domiciled). What does this mean? Live in Larnaca, work for the world, but in Cyprus it doesn’t matter of your profits. It is not surprising that commercial activities are in bloom like bougainville in spring there.
Ireland: the Holy Grail of American companies
Despite an income tax rate that would make a Swedish socialist cry, Ireland continues to exercise an attractive on Apple, Google and on your new startup. Why? Because he has 12.5 % Company income tax, an extremely digitized corporate environment and English. It can rain, but when the profits arrive, the sun shines. At least as regards your account. Certainly a tax paradise: the EU country with the most favorable taxation for foreign companies.
Italy: when bureaucracy meets paradise at a fixed rate
Italy? Really? YES. If you are quite rich and creative, the state will reward you with a fixed tax: € 200,000 per year And that’s all. It doesn’t matter how much you earned out of Italy. And if you are a pensioner, you will receive even better treatment: 7 % Foreign pension tax. Season everything with Chianti and a Tuscan sunset and you will have the perfect recipe for a fiscal romanticism.
The most favorable country for taxes in the EU? Why is Slovenia on this list?
Simple. In our country there is still a dangerous phenomenon the entrepreneur who should immediately collect half of everything he creates. (In practice more than half: income tax of companies + capital gain tax) Fortunately (or unfortunately) we are too ripe for tax adventures. But if you have courage, a little money and a lot of patience with the bureaucracy of another country, fiscal freedom awaits you a few hours of car away. Why is Slovenia at the center of this article, which you are reading in one of the 20 languages available? Because the author of this post is Slovenian. It is slightly disappointed by the tax system and the great state waste.
While Slovenia is still reflecting if an entrepreneur has to receive a medal or tax control for each success, some countries have understood for some time that the best way to attract investments is with a simple recipe: low taxes + high predictability + not too rigid officials. And in a nutshell: it works!
Hungaryfor example, it is not only the test for the political experiments of Orbán, but also the European Detroit 2.0. Chinese automotive giant BYD He recently brought his gigantic electric vehicle factory like if they were Lego bricks. Why? Because the tax on 9 % profits is not an offer that is received every day. And since the Hungarian government does not ask “why so fast?”, But “is there still a need for a railway line?”. Mercedes, BMW and Audi are already thrived in the same territory. It is not surprising that Hungary feels more and more the smell of a petrol-electric future.
Bulgaria In the meantime, she is like that shy girl at a party, but when you finally notice her, you realize that she has the lowest income tax, an excellent position and employees who know how to plan, sew and even speak English. That’s why in recent years computer companies, textile factories, German car suppliers and Fintech startups have poured here. And if someone doesn’t like that all this is done for a 10 %tax, he should check his accounting books.
And then there is Croatiaour neighbor of the South, which until a few years ago served as an investment for the beans cooked slowly, but now it is becoming a magnet for Chinese factories of electric vehiclesEuropean startups and luxury hotels. Rimac is an old story: now the Chinese are coming to build an electrical bus factory, and who else is involved? The reason? The euro, Schengen, a good logistics, the sun and, more importantly, the official women who finally started responding to e-mails.
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In short, while the West is still elaborating strategies to tax digital giants, The eastern end of Europe already laughs at its Excel spreadsheet – Because evidently he learned that capital does not like complications, but concrete numbers. And in Hungary, Bulgaria and now also in Croatia they are much more captivating than the PowerPoint on the “Vision 2030”.
Conclusion: in the EU there are tax havens. It simply doesn’t look like Bahamas.
Although no EU country is officially a “fiscal paradise”, many members, in particular Hungary, Bulgaria, Malta and Cyprus, have successfully developed systems that deal with your money with less hostility compared to the tax administrations of northern Europe. From flat -rate regimes to special treatments for foreigners and nomads: the EU offers much more than Schengen and GDPR. So, if you are interested in legal optimization (read: not to evasion), take into consideration the idea of transferring your company or yourself.
As a famous entrepreneur once said: “It is not a shame to pay taxes. It is a shame to pay too many”.
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