As a result of the 2004 elections in Romania, taxes were lowered at 16% .
Mid and long-term foreign investment decisions are usually influenced by a list of factors.
One of them is the fiscal policy of the targeted country.
After the actual start-up of the business investment, it's financial performance will be also influenced by the country's fiscal policy and political stability.
So, after having at point 0 (at start-up) a Corporate income tax of 35% and after 5 years this tax is to be modified at 16%, represents a decrease of costs for the investor.
Certain European countries have different levels of taxes for resident (national) corporations and non-resident (foreign) corporations. Furthermore, many countries have a progressive tax calculation formula, depending on turnover, profit or other criteria. In this article, we'll use only the corporate tax-where it is appreciable.
Greece for example reduces step by step his corporate taxes by 1% every year, so Greece will reduce the tax from 25% (2009) to 20% (2009)
France has for example a combined taxing system, there is a minimum annual corporation tax (based on the companies turnover) followed by the actual income tax of 33%
Romania addopted in 2005 the unique tax of 16% . The direct result was an acceleration of economic growth. Many skepticists believed, that by lowering the tax, the GDP will decrease.
Reality proved this presumption wrong,
Here some examples of corporate taxes in Europe:
| Country | Corporate income tax | Percent of GDP (for 2007) |
| Poland | 19.00% | 2.73% |
| Italy | 27.50% | 3.03% |
| Sweden | 26.30% | 3.28% |
| Netherlands | 25.50% | 3.27% |
| Lithuania | 20.00% | 2.74% |
| Finland | 26.00% | 0.26% |
| Hungary | 21.28% | 2.00% |
| Romania | 16.00% | 2.63% |
| France | 33.33% | 2.62% |
| Spain | 30.00% | 4.74% |
| Greece | 25.00% | 2.56% |
| Bulgaria | 10.00% | 2.96% |
| UK | 28.00% | 3.20% |
| Slovakia | 19.00% | 2.93% |
| Ireland | 12.50% | 2.73% |
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