CORPORATE INCOME TAX BURDEN OF MULTINATIONAL INSURANCE GROUPS: A CASE OF CROATIA, SERBIA AND SLOVENIA

The corporate income tax burden may be an important factor in investment decision-making. Multinational companies pay close attention to the analysis of corporate income tax burden in the countries where they operate and plan to invest. On the other hand, the corporate income tax burden may significantly vary across countries due to different statutory rates and rules for calculating taxable income. The corporate income tax burden in subsidiaries of multinational insurance groups in Croatia, Serbia, and Slovenia is analyzed in this paper. It is shown that the corporate income tax burden in insurance companies significantly differs between studied countries. Insurance companies in Serbia have by far the lowest tax burden, notably owing to tax loss carryforward and interest on government securities that are exempt from taxation. Although Slovenia has the highest statutory tax rate, insurance companies in Croatia have the highest average corporate effective tax rates. Many interest groups, particularly owners and managers of multinational insurance groups, may find the research findings interesting.

Keywords: corporate income tax, tax rates, tax planning, multinational companies, insurance, foreign direct investments.
JEL Classification: F23, G22, H25.