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Corporate Tax Rate Survey 2006 19
61 Peru (2006 rate = 30%)
Domestic corporations are subject to a corporate income tax rate of 30 percent under the general regime of Income Tax (IT). Branches of foreign companies are also subject to the IT rate of 30 percent, but only to the extent of their Peruvian source income. Additionally, dividends are subject to the rate of 4.1 percent when paid by a domiciled corporation to individuals, domiciled or not, or to foreign entities. Branches of foreign entities are also subject to the 4.1 percent IT rate when determining profits in the corresponding fiscal year, after applying the IT. A tax on net assets was introduced with effect from 2005. A bracket/marginal rate system is applied to determine this tax (the rate varies from zero percent to 0.6 percent, depending on the amount of taxable net assets). The tax is based on the net assets of domiciled corporate taxpayers after deducting certain balance sheet items specified in the legislation. This tax can be applied as a tax credit against the IT.
62 Philippines (2006 rate = 35%) After a four year start-up phase, domestic corporations and resident foreign corporations are subject to a 2 percent minimum corporate income tax (MCIT) based on gross income if the MCIT is greater than the corporate income tax determined by applying the 35 percent corporate income tax rate to the net income. A 10 percent Improperly Accumulated Earnings Tax (IAET), subject to certain exceptions, is also imposed on undistributed earnings of closely-held corporations, which are corporations in which at least 50 percent in value of the outstanding capital stock or at least 50 percent of the total combined voting power of all classes of stock entitled to vote is owned directly or indirectly by 20 individuals or less. Philippine branches of foreign corporations are exempt from the 10 percent IAET. Foreign corporations with Philippine branches pay 15 percent branch profits remittance tax. Philippine Economic Zone Authority (PEZA) registered corporations are exempt unless the applicable tax treaty provides otherwise. There are several other special tax regimes for certain types of activity.
63 Poland (2006 rate = 19%) Income from dividends are taxed at 19 percent, interest and royalties due to foreign companies are taxed at 20 percent and certain transportation services provided by foreign companies are taxed at 10 percent.
64 Portugal (2006 rate = 27.5%) This rate includes municipal tax at a rate of 2.5 percent. This is the maximum municipal tax rate levied by most municipalities.
65 Romania (2006 rate = 16%) Profits earned from operations in Free Trade Zones are subject to the regular corporate income tax of 16 percent. Note that until December 31, 2006 a special tax exemption applies to certain companies carrying out manufacturing activities within Free Trade Zones, which had been pre-invested in the Free Trade Zone prior to July 1, 2002. Profits earned from nightclubs, casinos, discotheques and sport betting organizers are levied at the standard corporate tax rate of 16 percent, but the tax cannot be lower than five percent of the taxpayer’s qualifying gross earnings. A special relief is available for very small companies.
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