Page 6 - CEE Tax Guide 2025

15% to 16%), Estonia (from 20 to 22%) and Slovakia Hungary still do not generally apply withholding
from 21% to 24%). The European Union consciously taxes on capital income.
strives to limit the tax race and to prevent the use In most countries in the CEE region, taxpayers
of the most harmful tax avoidance techniques. are allowed to prepare an IFRS-based individual
An important tool in this effort was the Anti-Tax financial statement and use it for tax purposes.
Avoidance Directive (ATAD and ATAD II), officially Many CEE countries offer tax incentives
known as Directives (EU) 2016/1164 and 2017/952. to encourage companies to invest in research and
The greatest challenge for many EU Member development (R&D).
States has been the adoption of these EU rules.
For example, following ATAD implementation, the Notably, corporate group taxation is available
previous rules on thin capitalization were replaced in Hungary, Austria, Bulgaria, Germany, Poland,
or supplemented by the method tied to EBITDA- Romania, Serbia, Bosnia and Herzegovina (FBiH),
based interest limitation calculation in the majority and Montenegro.
of the countries. The standardization of offshore It is a novelty in the field of corporate taxation that
(controlled foreign corporation, CFC) rules can also Poland implemented the JPK CIT (SAF-T standard
be traced back to the ATAD. Exit taxation regulations control files for CIT and fixed assets) from 2025 for
have also appeared in many countries.
entities with an annual turnover of mEUR 50.
Without exception, CEE countries applying
traditional corporate taxation allow the carrying Transfer pricing (TP)
forward of losses acquired in previous years and
putting them against the positive tax base of later The OECD’s BEPS (“Base Erosion and Profit
years. This amount can only be used for the purpose Shifting”) initiative drew attention to the fact that
during a predetermined period, usually 5 years. tax authorities need to focus more on possible
cross-border transactions within corporate groups.
The states of the region readily apply a withholding Transfer pricing regulations had previously appeared
tax on interest, dividend, and royalty revenues in the tax systems of practically all countries.
(at a rate of 15%, or even 19-20%). Naturally, these Taxpayers operating in the CEE region also had
can only be applied in the light of the provisions to participate actively in the implementation
of the corresponding tax agreements. However, of the CBC reporting system (OECD’s “country-by-

Countries included in the publication

Central and Eastern European tax guide 2025 Forvis Mazars 6