By Shannon Power, 5th February 2025
Corporate tax rates remain a key factor in shaping a country’s economic landscape and attracting foreign investment. In Europe, diverse tax policies present both opportunities and challenges for businesses. Among the nations that continue to stand out, Ireland remains a highly attractive destination for multinational companies due to its competitive corporate tax environment.
Understanding Corporate Tax in Europe
The European tax landscape is a complex mix of economic structures, fiscal policies, and corporate tax rates. Understanding these variations is crucial for businesses planning to expand into the European market. Below, we explore the corporate tax rates across different European regions and their impact on multinational enterprises.

Corporate Tax Rates Across Europe in 2025
Nordic Countries
Nordic countries, including Sweden, Denmark, and Finland, maintain higher corporate tax rates, typically ranging from 20% to 22%. These nations justify their higher rates with strong public services, robust infrastructure, and a highly skilled workforce, making them attractive for businesses in sectors like technology, renewable energy, and pharmaceuticals.
Western Europe
Countries such as Germany, France, and Belgium have corporate tax rates in the range of 25% to 29.9%. While these rates are relatively high, they are often accompanied by tax incentives for research and development (R&D) and foreign investment, helping businesses offset some of the tax burdens.
Southern Europe
Italy, Spain, and Greece continue to adjust their corporate tax policies to attract investment while maintaining fiscal stability. Corporate tax rates in these nations generally fall between 22% and 25%, with some offering special incentives to encourage startups, tech enterprises, and green initiatives.
Eastern Europe
Many Eastern European nations, including Poland, Hungary, and the Czech Republic, continue to leverage lower corporate tax rates to attract foreign direct investment. Corporate tax rates in these countries range from 9% to 19%, making them appealing locations for manufacturing, IT, and service-based industries.
United Kingdom
The UK’s corporate tax rate, following several adjustments in recent years, stands at 25% as of 2025. The small profits rate, which is payable by companies with profits of £50,000 or less, also remains at 19%. The government stays committed to maintaining a competitive tax environment, especially post-Brexit, through various reliefs and incentives, including R&D tax credits and investment allowances.
Ireland’s Corporate Tax Landscape in 2025
Ireland continues to be a major hub for international business, with its standard corporate tax rate remaining at 12.5% for most businesses and 6.25% for companies involved in Research and Development. However, as part of the OECD’s global tax reform agreement, Ireland has implemented a 15% minimum tax rate for large multinational corporations with global revenues exceeding €750 million. Non-trading income and income from an excepted trade are then taxed at a higher rate of 25%. Despite these changes, Ireland’s tax environment remains one of the most attractive in Europe for businesses of all sizes.
Benefits of Ireland’s Corporate Tax Structure
- Competitive Advantage: Ireland’s favourable tax rate allows companies to retain a larger portion of their profits, which can be reinvested back into the business for further growth. By retaining more capital, businesses have the opportunity to allocate funds toward key strategic initiatives such as expanding their product lines, improving operational efficiency, entering new markets, or increasing their workforce.
- Stability and Predictability: The country’s consistent tax policies offer businesses a sense of certainty when planning for the future. This long-term consistency in taxation rules helps businesses make strategic decisions with confidence, knowing that their tax liabilities will remain relatively predictable.
- R&D and Innovation Incentives: Ireland offers a robust suite of tax credits and reliefs specifically aimed at fostering research and development (R&D) and innovation. Companies engaged in R&D activities can benefit from the Research and Development Tax Credit, which allows them to claim a percentage of qualifying expenditures as a tax credit.
- Strong Global Reputation: Ireland has built a solid reputation as a stable, pro-business jurisdiction with strong ties to both the global market and the European Union. Its strategic location provides businesses with unparalleled access to the EU and US single market, making it a gateway for companies wishing to operate within Europe.
Conclusion
The European corporate tax landscape remains diverse, offering businesses a range of opportunities. While Ireland’s tax rate for large multinationals has risen slightly in response to global tax reforms, it continues to be one of the most business-friendly jurisdictions in Europe. With a strategic location, skilled workforce, and stable economy, Ireland remains a top destination for companies seeking to establish or expand their European presence.
If you have any further questions about corporate tax in Ireland or across Europe, please do not hesitate to contact the Company Bureau team. Give us a call at +353(0)1 6461625 or fill out our online contact form.
Disclaimer: This article is for guidance purposes only. It does not constitute legal or professional advice. No liability is accepted by Company Bureau for any action taken or not taken in reliance on the information set out in this article. Professional or legal advice should be obtained before taking or refraining from any action as a result of this article. Any and all information is subject to change.