Czech Republic

Czech Republic's Rankings
CategoryRankScore
Overall Rank775.49
Corporate Taxes871.12
Individual Taxes493.19
Consumption Taxes3552.59
Property Taxes676.94
Crossborder Taxes1282.32

The Czech Republic ranks 7th overall on the 2021 International Tax Competitiveness Index, the same as in 2020.


Strengths

  • The corporate rate of 19 percent is below the OECD average (22.9 percent), with above-average cost recovery provisions.
  • Taxes on labor are minimally distortive.
  • The Czech Republic has a territorial tax system, exempting both foreign dividend and capital gains income from other European countries, combined with a broad tax treaty network.

Weaknesses

  • Consumption taxes have a high compliance burden and apply to a relatively narrow base.
  • Net operating losses can only be carried forward for five years (they can, however, also be carried back for two years).
  • The Czech Republic's thin capitalization rules are among the stricter ones in the OECD.

Learn more about the tax system in Czech Republic

Get email updates about global tax policy from the Tax Foundation.

Subscribe today!