Estonia’s e-Residency program, launched in 2014, has seen a significant increase in tax revenue and state fees for the first half of 2023. The majority of tax receipts came from labor taxes paid by e-resident companies registered in Estonia, with the remaining 45 percent collected from special case income tax, mainly dividends. In addition to taxes, e-residents also paid €1.4 million in state fees, raising the program’s economic impact to €39.1 million for the first half of 2023.
Minister of Economic Affairs and Information Technology Tiit Riisalo stated that the e-Residency program continues to be a successful way for foreign entrepreneurs to conduct business in the European Union. The program provides a digital solution for safe and transparent operation with low administrative costs, and for every euro spent on e-Residency, the program generates €7.6 in return.
Liina Vahtras, the new managing director of the e-Residency program, confirmed that these results have exceeded the most optimistic estimates. The program is working hard to accelerate the issuance of digital ID cards so that e-residents would face no delays when setting up their businesses in Estonia. As of June 2023, e-resident companies employed 5,027 Estonian residents, up by 284 compared to 2022.
Estonia has granted e-resident status to 105,500 people from 176 countries, who have established more than 27,000 companies in Estonia. Currently, there are 61,350 active e-resident digital ID cards in use. As of March 2022, citizens of Russia and Belarus are not eligible to apply to the Estonian e-Residency program.
Over the years, the program has generated around €183 million in tax revenue and state fees for Estonia. In 2022, the Estonian government endorsed a new growth strategy for e-Residency, which envisions the program’s annual revenue to reach €100 million by 2025.