Swedish firms move to Austria to escape tax
The Local · 18 Apr 2006, 10:12
Published: 18 Apr 2006 10:12 GMT+02:00
Swedish business owners have discovered an innovative way to get out of paying taxes: move to Austria. A loophole makes it possible for entrepreneurs to avoid capital gains tax when they sell their companies, which could account for a 40 percent increase in the number of people making the move last year.
The business owners are taking advantage of an old tax agreement that states that a business owner who moves from Sweden to Austria only has to pay tax on the amount by which the company has increased in value between the time of the move and the time at which the company is sold. In practice, this can mean the owner escaping capital gains tax entirely.
Last year the number of Swedes moving to Austria increased by 40 percent, after having been constant for many years, Swedish Radio revealed. The Swedish tax authorities estimate that billions of kronor have remained untaxed because of the loophole.
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