Tax Haven Austria

Interest income is subject to a 25% tax in Austria, a very low rate in comparison to Germany and Switzerland, as shown in the table below (Source: Die Presse, 1.12.1999, 23):
 
As this is a 'final tax' in no connection with other income and no increase in progressive rates, the Austrian Inheritance Tax on interest income and other finally taxed funds can be avoided. Additional advantages are granted by the Private Foundation Act of 1993.
 
Due to this Foundation Act millions of EURO have been transacted to Austria during the last 12 years!
 
Important Tax Benefits beginning from 2005!
 
Corporate Income Tax Reduction!
Beginning from 2005 the nominal Austrian corporate income tax rate came down from 34% to 25%. According to a study, published by the Austrian IHS ' Institut für Höhere Studien (Institute for High Level Studies), the effective burden of corporate income tax will then figure at low 21.97%.
 
This brings Austria in a favourable situation in comparison with its neighbour states, beginning with 2005:
 
 
Mainly the difference to Germany is remarkable. Though the nominal rate is 25% a trade tax still levied additionally drives the German effective tax rate nearly up to 36%. Austria is now going to stand its ground in international economic competition. (Source: Die Presse, 30 Jan. 2004)
 
Group Relief
A comfortable consolidated taxation of groups of companies will replace the insufficient 'Organschaft' regulations, domestic and cross border.
 
Interest
Interest from loans for acquisition of participations (shares) will be deductable beginning from 2005.
 
A combination of these advantages makes Austria increasingly an interesting place for setting up international Holding Companies.