Minister: Estonia can postpone minimum corporate tax until 2030 | News


Nothing will change for countries with a turnover of less than 750 million euros, said Pentus-Rosimannus. Estonia will also be able to maintain the current system in which income tax is exempt for reinvested profits.

Estonia fought against the headline tax because it has no corporate tax rate for retained and reinvested profits.

“During the negotiations, we fervently defended the interests of Estonia and received basically all the exceptions in the project that are important for us, so from our point of view the agreement could have been approved today,” said Pentus-Rosimannus.

“It has been good to see how other Member States have started to see the pros and cons of minimum tax and to look for the best solutions.”

The Minister highlighted the possible postponement of the tax until 2030 for countries with less than 12 group headquarters with a turnover of 750 million euros.

“This would mean that we would only start applying the minimum tax at the national level after 2030 and even then only to large companies with an annual turnover of more than 750 million euros. For 99% of Estonian companies, nothing would change in terms of taxation under the current agreement,” she said.

EU ministers did not agree on the new rule on Tuesday because it must be unanimous and Poland opposed it.

Under the Estonian tax system, no corporate tax is levied on undistributed and reinvested profits. This means that resident companies and permanent establishments of foreign entities (including branches) see an income tax rate of 0% on all reinvested and retained earnings, as well as an income tax of 20% only for all profits distributed.

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