Estonia Abolishes 2% Security Tax for Businesses: What It Means for Companies?

Estonia Abolishes 2% Security Tax for Businesses: What It Means for Companies?

The Estonian government has decided to abolish the 2% security tax, which was set to take effect in 2026. This initiative marks a significant step in supporting businesses and attracting investors, as it reduces the tax burden and preserves Estonia’s competitiveness as a favorable jurisdiction for international companies.

Estonia’s Tax System: What You Need to Know?

Estonia is known for having one of the most progressive tax systems in Europe, particularly due to its unique corporate taxation mechanism. Unlike most countries, corporate income tax in Estonia is only paid when profits are distributed, meaning companies are taxed only when they pay out dividends. This system creates advantageous conditions for businesses, allowing them to reinvest earnings without additional financial strain.

The introduction of an additional 2% security tax could have negatively impacted this approach, reducing Estonia’s attractiveness to investors and encouraging companies to seek alternative jurisdictions. The decision to repeal this tax signals the government’s commitment to maintaining a business-friendly environment and fostering international investment.

Why Is This Particularly Important for Crypto Companies?

For years, Estonia has been regarded as one of the most reputable jurisdictions for crypto businesses. It has a well-defined legal framework that was established long before many other countries began regulating digital assets.

Key Advantages of Estonia for Crypto Companies:

• Remote Business Registration. With e-Residency, companies can be registered entirely online, without the need for physical presence in Estonia.
• High Legal Certainty. Estonia was one of the first EU countries to introduce a licensing system for crypto assets, meaning it has a well-established regulatory practice.
• Banking and Payment System Support. The Estonian crypto license is one of the most recognized in Europe, significantly facilitating cooperation with financial institutions.
• Easier Transition to MiCA Regulation. A crypto license obtained in Estonia can simplify the process of securing a MiCA license, which will apply across the European Union.

The abolition of the security tax further enhances Estonia’s attractiveness as a jurisdiction for crypto companies, as it lowers the tax burden and promotes business growth.

How Can FinanceIQ Hub Assist You in Launching a Crypto Business in Estonia?

Our company offers a comprehensive range of services for entrepreneurs who want to establish and operate a crypto business in Estonia under its favorable conditions. We assist with:

• Obtaining e-Residency for seamless remote business management.
• Registering a company and preparing all necessary statutory documents and policies.
• Obtaining an Estonian crypto license to operate legally within the regulatory framework.
• Ensuring compliance with regulatory requirements to avoid legal risks.
• Opening business accounts in banks and payment systems. We provide various options as operational accounts; clients’ fund accounts; merchant accounts. Different currencies, payment methods and jurisdictions are available.

With years of experience in crypto regulation, Estonia remains one of the most reliable options for registering a crypto company within the EU. If you are planning to start a business in this field, FinanceIQ Hub will guide you through every step efficiently and professionally.