background image

Austrian Government Program for 2020-2024 Includes Plans for Several Tax Reform Measures — Orbitax Tax News & Alerts

Austria's newly formed government has published its Program for 2020-2024, which includes plans for several tax reform measures. Some of the key measures include:

  • Reducing the second, third, and fourth individual income tax bracket rates from 25%, 35%, and 42% to 20%, 30%, and 40% as well as potential inflation adjustment to the bracket threshold to address bracket creep;
  • Increasing the base for the corporate tax-free allowance from EUR 30,000 to EUR 100,000, which results in a deduction of EUR 13,000 based on 13% rate;
  • Reducing the corporate tax rate from 25% to 21%;
  • Introducing of various tax measures to address climate change issues;
  • Furthering efforts for the introduction of a financial transactions tax in the EU;
  • Abolishing the minimum corporate tax to provide relief, especially for SMEs;
  • Maintaining the recently introduced digital tax on advertising, at least until significant progress is made at the level of the EU and OECD towards the introduction of a digital permanent establishment; and
  • Addressing VAT fraud, including the introduction of a reverse-charge system.

The reform measures are currently in the planning stages. Further information, including the timing of the measures, will be published once available.