Effective tax rates for income based tax incentives - Corporate tax statistics — Effective average tax rate by country
This table reports synthetic tax policy indicators that capture the effect of income-based R&D tax incentives on firms’ investment costs: The EATR for R&D measures the impact of taxation on R&D investments that earn an economic profit. the user cost of capital for R&D measures the return that a firm needs to...
What the numbers show
Effective tax rates for income based tax incentives - Corporate tax statistics — Effective average tax rate is currently reported for 39 countries. The highest value is 41.83 Percentage of taxable income in India; the lowest is 8.73 Percentage of taxable income in Bulgaria.
The median across all reporting countries is 23.57 Percentage of taxable income, and the mean is 22.29 Percentage of taxable income.
The gap between the highest and lowest reporting country is a factor of about 5.
Over the past decade 5 countries rose and 20 fell. The largest increase was in Slovenia (up 29.4%), and the largest decrease in Cyprus (down 64.3%).
Effective tax rates for income based tax incentives - Corporate tax: full country ranking
| # | Country | Latest | Year | 10-year change | Trend |
|---|---|---|---|---|---|
| 1 | India | 41.83 Percentage of taxable income | 2016 | up 11.5% | flat |
| 2 | United States of America | 33.96 Percentage of taxable income | 2017 | down 0.9% | flat |
| 3 | Belgium | 31.4 Percentage of taxable income | 2006 | down 10.4% | falling |
| 4 | Argentina | 30.55 Percentage of taxable income | 2004 | — | flat |
| 4 | Malta | 30.55 Percentage of taxable income | 2018 | unchanged | flat |
| 4 | Colombia | 30.55 Percentage of taxable income | 2025 | down 5.4% | flat |
| 7 | Brazil | 29.68 Percentage of taxable income | 2025 | unchanged | flat |
| 8 | Portugal | 27.49 Percentage of taxable income | 2013 | down 4.5% | falling |
| 9 | Germany | 26.3 Percentage of taxable income | 2025 | up 1.2% | falling |
| 10 | Mexico | 26.18 Percentage of taxable income | 2025 | unchanged | falling |
| 10 | Australia | 26.18 Percentage of taxable income | 2025 | unchanged | flat |
| 10 | Costa Rica | 26.18 Percentage of taxable income | 2025 | unchanged | flat |
| 13 | Japan | 26.16 Percentage of taxable income | 2016 | down 24.2% | falling |
| 14 | Netherlands | 25.84 Percentage of taxable income | 2006 | down 15.4% | falling |
| 15 | Peru | 25.75 Percentage of taxable income | 2025 | up 5.4% | flat |
| 16 | New Zealand | 24.44 Percentage of taxable income | 2025 | unchanged | falling |
| 17 | Italy | 24.27 Percentage of taxable income | 2025 | down 11.1% | falling |
| 18 | Luxembourg | 23.64 Percentage of taxable income | 2017 | down 8.6% | falling |
| 19 | Chile | 23.57 Percentage of taxable income | 2025 | up 20.0% | rising |
| 19 | South Africa | 23.57 Percentage of taxable income | 2025 | down 3.6% | falling |
| 21 | Greece | 21.82 Percentage of taxable income | 2009 | down 37.5% | falling |
| 22 | United Kingdom of Great Britain and Northern Ireland | 20.95 Percentage of taxable income | 2012 | down 20.0% | falling |
| 23 | Austria | 20.07 Percentage of taxable income | 2025 | down 8.0% | falling |
| 24 | Norway | 19.2 Percentage of taxable income | 2025 | down 18.5% | falling |
| 24 | Slovenia | 19.2 Percentage of taxable income | 2025 | up 29.4% | falling |
| 24 | Denmark | 19.2 Percentage of taxable income | 2025 | down 6.4% | falling |
| 24 | Indonesia | 19.2 Percentage of taxable income | 2025 | down 12.0% | falling |
| 28 | Sweden | 17.98 Percentage of taxable income | 2025 | down 6.4% | falling |
| 29 | Finland | 17.46 Percentage of taxable income | 2025 | unchanged | falling |
| 29 | Iceland | 17.46 Percentage of taxable income | 2025 | unchanged | falling |
| 31 | Poland | 16.58 Percentage of taxable income | 2018 | unchanged | falling |
| 31 | Czechia | 16.58 Percentage of taxable income | 2011 | down 38.7% | falling |
| 33 | Croatia | 15.71 Percentage of taxable income | 2025 | down 10.0% | falling |
| 34 | Hong Kong, China | 14.4 Percentage of taxable income | 2022 | unchanged | flat |
| 35 | Romania | 13.97 Percentage of taxable income | 2025 | unchanged | falling |
| 36 | Lithuania | 13.09 Percentage of taxable income | 2017 | down 16.7% | falling |
| 37 | Ireland | 10.91 Percentage of taxable income | 2015 | — | flat |
| 38 | Cyprus | 8.73 Percentage of taxable income | 2011 | down 64.3% | falling |
| 38 | Bulgaria | 8.73 Percentage of taxable income | 2025 | unchanged | falling |
Regions and income groups
Aggregates are excluded from the country ranking above so that a region can never outrank a country.
- China (People's Republic of) 28.8 Percentage of taxable income
- Basque Country 24.44 Percentage of taxable income
- Quebec 23.48 Percentage of taxable income
- Slovak Republic 18.33 Percentage of taxable income
- Saskatchewan 21.82 Percentage of taxable income
- Korea 17.46 Percentage of taxable income
- Zurich 18.46 Percentage of taxable income
- Nidwalden 13 Percentage of taxable income
About this data
This table reports synthetic tax policy indicators that capture the effect of income-based R&D tax incentives on firms’ investment costs: The EATR for R&D measures the impact of taxation on R&D investments that earn an economic profit. the user cost of capital for R&D measures the return that a firm needs to realise on an R&D investment before tax to offset all costs and taxes that arise from the investment, making zero economic profit. Further methodological information is available in the explanatory annex.