3 ms·

> I still completely fail to realize which actual problems were solved by e-residency (setting aside some good money going to Estonia). It's still not exactly

> I still completely fail to realize which actual problems were solved by e-residency (setting aside some good money going to Estonia). It's still not exactly clear what money would go to Estonia. I'm no tax advisor but reading previous threads indicate that even if you incorporate a company in Estonia but solely operate it from another country that has tax treaties with Estonia (and many do) you still need to do your taxes locally, not in Estonia. So except the fee for the card and processing company application there are no big money to be made here.

mgiannopoulos 9y ago
Several Estonian companies have been created to support this. Estonian banks have new clients. Some taxes will eventually be paid one way or the other. All these are better than nothing for Estonia.
jononor 9y ago
You mean for the income tax right? The tax on company profits I would expect to still go to Estonia?
jaclaz 9y ago
>So except the fee for the card and processing company application there are no big money to be made here. Well, even that is not trifling, when you make due proportions. The population is 1,350,000 roughly, the 30,000 (till now) e-residencies at - say - 100 Euro each (state fee only) are 3,000,000, if everyone will register a company that will be another 230 Euro, i.e. 6 or 7 millions, then you will have some yearly fees (for keeping the books, etc., etc.) and possibly some other service fees like (example): https://www.leapin.eu/faq/cost-and-fees https://www.leapin.eu/faq/cost-and-fees Let's say 1,500 - 2,000 Euro/year as "basic" costs that will go to either the Estonian government or to Estonian firms/individuals. If the whole thing will generate a direct and indirect income of 30,000x2,000=60,000,000 that will be 50 €/citizen, not that bad in a country where the average salary is around 13,000 Euro/year. And this is in the hypothesis that no actual transaction is done by any of the 30,000 firms, surely something will be generated (and some part of it remain in Estonia) by them. Of course these are only guesses, but - unless there are some favourable tax "workarounds" or however lower taxes - there are very few reason that I can see why one would want to establish a "virtual" company in Estonia. Most probably the people that will be interested in it are non-EU and coming from countries that somehow have no tax treaties (or whatever) and that (still somehow) will have some advantage. It is the "somehow" and the actual "advantages" that are not clear to me.
- nileshtrivedi 9y ago
  The fee used to be 50 EUR which they had to double because of growing demand.

mgiannopoulos 9y ago

Several Estonian companies have been created to support this. Estonian banks have new clients. Some taxes will eventually be paid one way or the other. All these are better than nothing for Estonia.

jononor 9y ago

You mean for the income tax right? The tax on company profits I would expect to still go to Estonia?

jaclaz 9y ago

>So except the fee for the card and processing company application there are no big money to be made here. Well, even that is not trifling, when you make due proportions. The population is 1,350,000 roughly, the 30,000 (till now) e-residencies at - say - 100 Euro each (state fee only) are 3,000,000, if everyone will register a company that will be another 230 Euro, i.e. 6 or 7 millions, then you will have some yearly fees (for keeping the books, etc., etc.) and possibly some other service fees like (example): https://www.leapin.eu/faq/cost-and-fees https://www.leapin.eu/faq/cost-and-fees Let's say 1,500 - 2,000 Euro/year as "basic" costs that will go to either the Estonian government or to Estonian firms/individuals. If the whole thing will generate a direct and indirect income of 30,000x2,000=60,000,000 that will be 50 €/citizen, not that bad in a country where the average salary is around 13,000 Euro/year. And this is in the hypothesis that no actual transaction is done by any of the 30,000 firms, surely something will be generated (and some part of it remain in Estonia) by them. Of course these are only guesses, but - unless there are some favourable tax "workarounds" or however lower taxes - there are very few reason that I can see why one would want to establish a "virtual" company in Estonia. Most probably the people that will be interested in it are non-EU and coming from countries that somehow have no tax treaties (or whatever) and that (still somehow) will have some advantage. It is the "somehow" and the actual "advantages" that are not clear to me.

nileshtrivedi 9y ago
The fee used to be 50 EUR which they had to double because of growing demand.