Greece is the champion in SME taxation

Greece is the champion in SME taxation

Greece currently ranks as the European Union country with the highest taxation on small and medium-sized enterprises (SMEs), according to a survey by the Organization for Economic Cooperation and Development (OECD), which puts it beside Germany at the top spot of its Europe list.

While Germany has a slightly higher income tax rate (29.8 percent) on SMEs than the one imposed by the Greek government a few days ago (29 percent), Germany is actually cheaper for SMEs. The reason is that there is no such thing in Germany as a separate business tax, which costs Greek companies 1,000 euros per year regardless of whether they are making profits or losses.

Other than comparing tax rates, the OECD data point to an apparent indifference in Greece for SME activity or employment via the tax system. France, for example, charges a high rate on bigger enterprises (31.33 percent) but has a particularly low rate for SMEs at 15 percent, one of the smallest in Europe.

The left-led government has abandoned the system of different rates depending on the company’s size, imposing a flat rate on all enterprises instead. It argued that this was the purpose of the corporate tax hike that was introduced.

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