Having a competitive tax system is one of the most attractive merits for businesses, who are always looking for higher profit, and therefore the Tax Foundation has set guideline rating countries according to their tax competitiveness scheme.
The international tax competiveness index relies on 40 different tax policy variables, but puts more emphasis on two basic criteria, which are competitiveness and neutrality.
According to the index, Estonia retained its first place for the sixth straight year in 2019, as its 20% tax on corporate income is only applied to dividends.
In addition, a 20% tax on per capita income does not apply to personal earnings income and property tax applies only to the value of the land. It also fully exempts foreign profits generated from domestic companies from local taxes.
Registering a score above 80, New Zealand, Latvia and Lithuania were in the second, third, and fourth places respectively.
Surprisingly, the United States emerged in the 21th place after getting only 63.7 out of 100, while France had the least competitive tax system, given its high corporate income tax and property taxes.