"Do not accept the offer," the portal cited Saule Dagilyte, tax partner at Sorainen law office, saying that the tax advantages in Estonia are limited – the main advantage, in comparison to Lithuania, is that companies are not required to pay profit tax every year, as the tax only applies on distributed profits. Meanwhile, profit-making companies in Lithuania pay taxes on an annual basis. The profit tax tariff in Estonia is 20%, as compared to 15% in Lithuania, which is one of the smallest tariffs worldwide. However, Estonia is the only country in the European Union that does not require paying the profit tax until the profit is distributed.
Arvydas Avulis, Lithuanian businessman who moved his Hanner holding to Estonia, said Estonia was more favorable for international companies: "If you are an international company, moving to Estonia is a beneficial and right thing go do. However, if your operations are only in Lithuania, this is not the way. We work in other countries and must have a holding in one of the countries to have the shares of the other companies. Today it is more beneficial to have the holding in Estonia than in Lithuania."
