Estonia's reinvested-profit tax model turns ten: a magnet for startups

Estonia's distinctive corporate tax model — 0% tax on retained and reinvested profit, taxed only on distribution — has now been in place for a decade.

Founders say the model lets them compound capital in early years, which underpins one of Europe's densest startup and fintech ecosystems.

Digital residency and a fully online company-filing process keep incorporation friction low for location-independent teams.

Policymakers are studying whether to extend similar treatment to scale-up stock options to stay competitive with newer regimes.