Corporate Income Tax Rates in Europe, 2023

European countries—like almost all countries around the world—require businesses to pay corporate income taxes on their profits. The amount of taxes a business ultimately pays on its profits depends on both the corporate tax baseThe tax base is the total amount of income, property, assets, consumption, transactions, or other economic activity subject to taxation by a tax authority. A narrow tax base is non-neutral and inefficient. A broad tax base reduces tax administration costs and allows more revenue to be raised at lower rates. and the corporate taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. rate. Today’s map shows how statutory corporate income tax rates compare across European OECD countries.

Taking into account central and subcentral taxes, Portugal has the highest statutory corporate income taxA corporate income tax (CIT) is levied by federal and state governments on business profits. Many companies are not subject to the CIT because they are taxed as pass-through businesses, with income reportable under the individual income tax. rate among European OECD countries, at 31.5 percent. Germany and Italy follow, at 29.8 percent and 27.8 percent, respectively. Hungary (9 percent), Ireland (12.5 percent), and Lithuania (15 percent) have the lowest corporate income tax rates.

On average, European OECD countries currently levy a corporate income tax rate of 21.5 percent. This is slightly below the worldwide average which, measured across 180 jurisdictions, was 23.4 percent in 2022.

European countries—like most regions around the world—have experienced a decline in corporate income tax rates over the past decades, but the average corporate income tax rate has leveled off in recent years. Of the 27 European countries, only the Netherlands increased its corporate income tax rate in the last year, a trend expected to hold steady as countries have more efficient tax types to turn towards.

2023 Corporate Tax Rates in Europe

Combined Statutory Corporate Income Tax Rates in European OECD Countries, 2023
European OECD Country	Combined Statutory Corporate Income Tax Rate
Australia	30.00
Austria	25.00
Belgium	25.00
Canada	26.21
Chile	10.00
Colombia	35.00
Costa Rica	30.00
Czech Republic	19.00
Denmark	22.00
Estonia	20.00
Finland	20.00
France	25.83
Germany	29.83
Greece	22.00
Hungary	9.00
Iceland	20.00
Ireland	12.50
Israel	23.00
Italy	27.81
Japan	29.74
Korea	27.50
Latvia	20.00
Lithuania	15.00
Luxembourg	24.94
Mexico	30.00
Netherlands	25.80
New Zealand	28.00
Norway	22.00
Poland	19.00
Portugal	31.50
Slovak Republic	21.00
Slovenia	19.00
Spain	25.00
Sweden	20.60
Switzerland	19.70
Türkiye	23.00
United Kingdom	19.00
United States	25.81
Note: Combined statutory corporate income tax rates include both central and subcentral corporate income tax rates. Source: OECD, “Tax Database: Table II.1. Statutory corporate income tax rate;” and Bloomberg Tax, “Country Guide.”

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