the-income-tax-cuts-supported-private-consumption-in-austria The Income Tax Cuts Supported Private Consumption in Austria

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The Income Tax Cuts Supported Private Consumption in Austria

The-Income-Tax-Cuts- Supported-Private-Consumption-in-Austria.jpgAccording to the International Monetary Fund, the tax cuts implemented in Austria in 2016 contributed to an economic recovery. While the growth was minimal during 2012-2015, it was revived in 2016, mainly driven by private consumption and a recovery of investments in Austria. One of our lawyers in Austria can give you complete information on the investment climate and the current tax regime for companies and individuals.

Tax cuts to boost economic growth

 
Austria’s recently implemented tax relief contributed to a large extent to the country’s economic recovery during 2016, as shown in a report provided by the International Monetary Fund (IMF). While growth was behind during 2012-2016, with only 0.6 percent, in 2016 the rate grew to 1.4 percent, due to private consumption and the recovery of the investment sector.
 
The report also highlighted that the country could focus even more on shifting the tax from labor to property. This, as recommended by the IMF, could be done by improving the efficiency of the value added tax system. While business and consumption taxes are best settled at a federal level, the IMF recommended in its report that Austria could shift liability for tax collection towards local authorities.
 
One of our lawyers in Austria can give you details on the implementation of federal and local taxes.
 

The current tax regime in Austria

 
The current corporate income tax in Austria is 25% and a reduced annual minimum corporate income tax regime applicable only to certain types of companies that qualify. The personal income tax regime is a progressive one, up to 55%. The IMF’s recommendations mainly focused on the personal income tax, which may, in some cases, hinder the creation of new jobs. 
 
Austria welcomes foreign investors and various business fields are open for investments. To find out more about the legislation and the conditions for foreign entrepreneurs, please don’t hesitate to contact the experts at our law firm in Austria.