Top Personal Income Tax Rates in Europe, 2025
Denmark (55.9 percent), France (55.4 percent), and Austria (55 percent) levy the highest top personal income tax rates in Europe.
4 min read
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VAT Rates in Europe, 2025
More than 175 countries worldwide—including all major European countries—levy a value-added tax (VAT) on goods and services. EU Member States’ VAT rates vary across countries, though they’re somewhat harmonized by the EU.
5 min read
Corporate Income Tax Rates in Europe, 2025
Some European countries have raised their statutory corporate rates over the past year, including Czechia, Estonia, Iceland, Lithuania, and Slovenia.
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Thin-Cap Rules in Europe
To discourage this form of international debt shifting, many countries have implemented so-called thin-capitalization rules (thin-cap rules), which limit the amount of interest a multinational business can deduct for tax purposes.
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CFC Rules in Europe
To prevent businesses from minimizing their tax liability by taking advantage of cross-country differences, countries have implemented various anti-tax avoidance measures, such as the so-called Controlled Foreign Corporation (CFC) rules.
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VAT Exemption Thresholds in Europe
To reduce tax compliance and administrative costs, most countries have VAT exemption thresholds: If a business is below a certain annual revenue threshold, it is not required to participate in the VAT system.
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Net Operating Loss Carryforward and Carryback Provisions in Europe, 2021
Many companies have investment projects with different risk profiles and operate in industries that fluctuate greatly with the business cycle. Carryover provisions help businesses “smooth” their risk and income, making the tax code more neutral across investments and over time.
7 min read
VAT Bases in Europe
As economic activity resumes and the task of accounting for the deficits incurred in navigating the crisis of the past year becomes the focus of fiscal policy deliberations, a greater reliance on VAT could be an important tool in ensuring fiscal stability going forward. Countries should use this as an opportunity to improve VAT systems by re-examining carveouts in the form of exemptions and reduced rates.
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Reduced Corporate Income Tax Rates for Small Businesses in Europe
Corporate income taxes are commonly levied as a flat rate on business profits. However, some countries provide reduced corporate income tax rates for small businesses. Out of 27 European OECD countries covered in today’s map, eight levy a reduced corporate tax rate on businesses that have revenues or profits below a certain threshold.
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Carbon Taxes in Europe, 2021
In recent years, several countries have taken measures to reduce carbon emissions, including instituting environmental regulations, emissions trading systems (ETS), and carbon taxes.
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Tax Relief for Families in Europe
Most countries provide tax relief to families with children—typically through targeted tax breaks that lower income taxes. While all European OECD countries provide tax relief for families, its extent varies substantially across countries.
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Dividend Tax Rates in Europe, 2021
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Top Personal Income Tax Rates in Europe, 2021
Most countries’ personal income taxes have a progressive structure, meaning that the tax rate paid by individuals increases as they earn higher wages. The highest tax rate individuals pay differs significantly across Europe, with Denmark (55.9 percent), France (55.4 percent), and Austria (55 percent) having the highest top statutory personal income tax rates among European OECD countries.
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Estate, Inheritance, and Gift Taxes in Europe, 2021
Estate tax is levied on the property of the deceased and is paid by the estate itself. Inheritance taxes, in contrast, are only levied on the value of assets transferred and are paid by the heirs. Gift taxes are levied when property is transferred by a living individual. The majority of European countries covered in today’s map currently levy estate, inheritance, or gift taxes.
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Capital Gains Tax Rates in Europe, 2021
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Inventory Valuation in Europe
The method by which a country allows businesses to account for inventories can significantly impact a business’s taxable income. When prices are rising, as is usually the case due to factors like inflation, LIFO is the preferred method because it allows inventory costs to be closer to true costs at the time of sale.
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Corporate Income Tax Rates in Europe, 2021
On average, European OECD countries currently levy a corporate income tax rate of 21.7 percent. This is below the worldwide average which, measured across 177 jurisdictions, was 23.9 percent in 2020.
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Bank Taxes in Europe
Today’s map shows which European OECD countries implemented financial stability contributions (FSCs), commonly referred to as “bank taxes.”
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Reliance on Property Taxes in Europe
Property taxes are levied on the assets of an individual or business. There are different types of property taxes, with recurrent taxes on immovable property (such as property taxes on land and buildings) the only ones levied by all countries covered. Other types of property taxes include estate, inheritance, and gift taxes, net wealth taxes, and taxes on financial and capital transactions.
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Reliance on Consumption Taxes in Europe
Hungary relies the most on consumption tax revenue, at 45.3 percent of total tax revenue, followed by Latvia and Estonia at 45.1 percent and 42.4 percent, respectively.
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Reliance on Social Insurance Tax Revenue in Europe
Social insurance taxes are the second largest tax revenue source in European OECD countries, at an average of 29.5 percent of total tax revenue.
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Reliance on Individual Income Tax Revenue in Europe
Denmark relies the most on revenue from individual income taxes, at 52.4 percent of total tax revenue, followed by Iceland and Ireland at 40.8 percent and 31.5 percent, respectively.
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Reliance on Corporate Income Tax Revenue in Europe
Despite declining corporate income tax rates over the last 30 years in Europe (and other parts of the world), average revenue from corporate income taxes as a share of total tax revenue has not changed significantly compared to 1990.
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