Corporate tax trends in Europe, 2018-2021


Corporate tax rates have fallen around the world in the last two decades. Today’s map shows the most recent changes in corporate tax rates in European OECD countries, comparing the development of combined statutory corporate tax rates between 2018 and 2021. The rate average tax rate of all European countries covered a decreases from 22.8% in 2018 to 21.8% in 2021.

The combined statutory corporate tax rates reflect the central and subnational corporate tax rates. Statutory tax rates do not necessarily reflect the actual tax burden of a business as they do not take into account adjustments to the tax base. Effective corporate tax rates, on the other hand, reflect both statutory tax rates and provisions affecting the tax base, such as depreciation allowances, inventory valuation methods or international tax rules.

Belgium

Belgium lowered its combined statutory corporate tax fell from 34% in 2017 to 29.6% in 2018. In 2020, the rate was further reduced to 25%. Since 2018, small and medium-sized businesses are subject to a reduced rate of 20% on the first € 100,000 (US $ 118,000) of taxable profits.

France

France takes a Standard maximum corporate tax rate of 27.5% and a surtax of 3.3%, resulting in a combined statutory rate of 28.41 percent. In 2017, France levied a temporary Exceptional surtax on the profits of companies whose turnover exceeds 250 million euros (295 million US dollars) at the rate of 10.7%. This surcharge was abolished in 2018, reducing the highest combined legal rate from 44.4% in 2017 to 34.4%. France has further rate cuts program, leading to a combined rate of 25.8% by 2022.

Greece

In 2019, Greece reduced its corporate rate from 29% to 28%, then to 24 percent.

Luxembourg

The combined corporate tax rate in Luxembourg has been reduced gradually from 27.1% in 2017 to 26% in 2018, 25% in 2019 and 24.9% in 2020.

Norway

Norway reduced its corporate tax rate fell from 24% in 2017 to 23% in 2018 and 22% in 2019.

Sweden

Sweden has legislated decrease of its corporate tax rate, from 22% in 2018 to 21.4% in 2019. In 2021, Sweden further reduced the corporate tax rate to 20.6.

Switzerland

Switzerland’s combined corporate tax rate fell from 21.1% to 19.7% in 2021. While the central government corporate tax rate remained unchanged at 8.5 %, the representative corporate tax rate for subnational government increased from 14.4% to 12.9%.

Turkey

In 2018, Turkey increase its legal rate rose from 20% to 22% for 2018, 2019 and 2020. In 2021, it increased it further to 25%.

Changes in the highest combined corporate tax rates
Country 2018 tax rate 2019 tax rate 2020 tax rate 2021 tax rate
Belgium (BE) 29.6% 29.6% 25.0% 25.0%
France (FR) 34.4% 34.4% 32.0% 28.4%
Greece (GR) 29.0% 28.0% 24.0% 24.0%
Luxembourg (LU) 26.0% 25.0% 24.9% 24.9%
Norway (NO) 23.0% 22.0% 22.0% 22.0%
Sweden (SE) 22.0% 21.4% 21.4% 20.6%
Switzerland (CH) 21.1% 21.1% 21.1% 19.7%
Turkey (TR) 22.0% 22.0% 22.0% 25.0%

Source: EU, “Tax trends in the European Union”, June 24, 2021, https://op.europa.eu/en/publication-detail/-/publication/d5b94e4e-d4f1-11eb-895a-01aa75ed71a1/language-en; OECD, “Tax Policy Reforms 2021: Special Edition on Tax Policy during the COVID-19 Pandemic”, April 21, 2021, https://www.oecd.org/ctp/tax-policy-reforms-26173433.htm; and OCDE.Stat, “Table II.1 Statutory corporate tax rate”, 2021, https://stats.oecd.org/Index.aspx?DataSetCode=CTS_CIT#.

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