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Estonia vs Germany
Tax Rate Comparison

Enter your income below for a personal tax estimate, then scroll down for full rate breakdowns.

πŸ‡ͺπŸ‡ͺ Estonia
vs
πŸ‡©πŸ‡ͺ Germany
Tax Year:

πŸ’° Personal Income Tax Calculator

Enter your income to see your estimated annual tax liability in each country β€” side by side.

Enter your annual income above to see your personal tax comparison β†’
Individual Income Tax (Top Marginal Rate)
Top Income Tax Rate
22%
22% national + local supplement; defence spending driving rate increases
No change
14–45%
Basic allowance ~€12,336; bracket creep relief
No change
VAT / GST / Sales Tax
VAT / GST / Sales Tax
9–24%
24% standard; defence-driven fiscal pressure
No change
7–19%
Standard 19% unchanged
No change
Corporate Tax Rate
Corporate Tax Rate
22%
22% on distributed profits; retained earnings still 0%
No change
~29%
Coalition discussions on lowering to 25% ongoing
β–Ό -0.5pp vs 2025
Capital Gains Tax
Capital Gains Tax
22%
22% as income
No change
25%
Investment income reform proposals under review
No change
Social Security & Payroll
Social Security / Payroll
~33%
33% social tax maintained; III pillar voluntary pension growing
No change
~41.5%
Health insurance rising; pension base up
β–² +0.5pp vs 2025
State, Regional & Local Taxes

πŸ‡ͺπŸ‡ͺ Estonia β€” Local Income Tax Supplement

Estonia's 79 local governments levy a local income tax supplement of 11.4% of taxable income (2024), collected alongside the national 20% income tax. Together these form the effective total income tax. Estonia's unique fully distributed profit taxation system means companies pay no corporate income tax on retained earnings β€” only on distributed profits (dividends). This has driven significant foreign investment. Land tax (maamaks) is levied at 0.1%–2.5% of assessed land value by municipalities.

πŸ‡©πŸ‡ͺ Germany β€” Trade Tax (Gewerbesteuer) & Church Tax

Germany's 16 BundeslΓ€nder apply federal income tax rates uniformly β€” no state income tax variation. Municipalities levy Gewerbesteuer (trade tax) on business profits at ~7–17% effective. Church tax (Kirchensteuer) of 8–9% of income tax applies to registered members. The solidarity surcharge (Soli) now only applies to the top ~10% of earners.

⚠️ Disclaimer: Rates shown are standard top/headline rates for informational purposes. Actual tax liability depends on income level, residency, deductions, and tax treaties. 2025–2026 data reflects announced or enacted rates and may be subject to change. Not financial or legal advice.

Estonia vs Germany: Key Tax Differences (2026)

πŸ’° Income Tax: πŸ‡©πŸ‡ͺ Germany has a higher top income tax rate (22% vs 14–45%). πŸ‡ͺπŸ‡ͺ Estonia is more favourable for high earners.

πŸ›’ VAT/Sales Tax: Estonia has a higher consumption tax (9–24% vs 7–19%).

🏒 Corporate Tax: πŸ‡ͺπŸ‡ͺ Estonia offers a lower corporate rate (22% vs 29%), which can influence business location decisions.

πŸ“ˆ Capital Gains: πŸ‡ͺπŸ‡ͺ Estonia taxes investment gains at a lower rate (22% vs 25%), benefiting investors.

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