PM Luxon Needs to Talk Tax with Estonian Prime Minister

The Taxpayers’ Union is calling on Prime Minister Christopher Luxon to discuss tax policy with Estonia which has ranked number one on the Tax Foundation’s International Tax Competitiveness Index for 10 years in a row. Estonia’s world-leading tax policy has led to significant economic growth, far outpacing New Zealand's.

World Bank statistics reveal that between 1995 and 2020, Estonia’s economic growth was 160.59%. Over the same period, New Zealand’s economic growth was significantly less at 95.85%.

Taxpayers’ Union Campaigns Manager, Connor Molloy, said:

“Estonia has the best tax code in the OECD. It ranks first overall and second (behind neighbouring Latvia) for corporate tax. Whilst New Zealand ranks highly overall, our corporate tax ranking is near the bottom at twenty-ninth.

“A key reason for the stark difference in economic performance is Estonia’s tax system. In 1994 Estonia introduced a flat tax rate on all personal and corporate income which was further reduced to 20% in 2015. Corporate profits are only taxed when distributed to shareholders – profits reinvested in the corporation are not taxed.

“Our Prime Minister would do well to discuss the impact of Estonia’s tax policies on economic growth when he meets with their prime minister, Kaja Kallas, in Washington.”