EU tax directive will stand in Estonia

Denying that Estonia will have to give up her zero corporate income tax often seems the national pastime of many Estonian politicians. But Estonia’s European Commission deputy president Siim Kallas says that Estonia should not hope that it can preserve its corporate income tax system after the transition period granted by the EU ends.

Lootus on lollide lohutus (“Hope is the comfort of the stupid”) is a popular expression of Estonians, whose history of having their towns burned to the ground (Tartu: 54 times), makes them culturally averse to hope. But everyone speculates about their hope to preserve their zero corporate income tax. And most agree it’s just political grandstanding.

Estonia’s corporate income tax system must be brought in line with EU parent and subsidiary companies directive by January 1, 2009, at latest.