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Slovakia currently has the fastest growing economy in Central Europe whose tax reforms, highly skilled labour force and government incentives have created an investors paradise attracting the likes of U.S. Steel, Dell Computer Corporation, Johns Manville, Peugeot-Citroen, Hyundai, Kia Motors, Ford Motors, Volkswagen and IBM

“Slovakia had the fastest transforming business environment in the world last year, and already comparisons are being drawn with Ireland's economic transformation in the 1990s. Low labour costs, low taxes and political stability make this one of the most attractive economies in Europe".
Source: World Bank

The tax reforms and economic success, along with a highly skilled, highly educated, low cost labour force has made Slovakia an investor’s paradise with foreign investment expected to double this year to 2.2bn euros. In fact, by 2007 Slovakia will be the largest car producer per capita in the world!

Srategic Position & Global Economy

Slovakia’s strategic position in the centre of Central Europe, bridging the East and the West is key to it’s current and future economic success. Slovakia is a member of the WTO and OECD and a year ago it joined the EU and NATO. Slovakia has a large industrial heritage with advancements now in electro-technology, automotive, engineering and lately it has seen large investment possibilities in information technology and strategic services.

Eurozone Entry & Euro Adoption

In the current economic and fiscal situation, Slovakia should meet all the Maastricht criteria by 2007 and beat all its Central European neighbours to join the Eurozone and adopt the Euro.

The Property Market

The Slovak Government has gone out of its way to encourage investment and recent tax reforms encouraging foreign direct investment have led to an economic boom. This Economic success has created a new middle and upper class on higher wages looking to upgrade their homes and lifestyles. Housing demand from foreign company employees in the Capital is also strong and growing faster than the rate of quality housing can be built.

Unlike most other new EU countries, it is not necessary for foreigners to set up a local company to purchase property through and mortgage products for both local and foreign buyers are increasing every week. The introduction of mortgages has meant affordability for Slovaks has quadrupled and their demand is playing a very important role in the property market in Slovakia.

Most importantly, the Slovakia and Bratislava property market has only just started taking off unlike many of it’s neighbours whose markets have seen tremendous growth over the last few years. Prices in Slovakia have a long way to go to catch up to those of Prague, Budapest and importantly Vienna which is less than 40 miles away.

Low Taxes

Slovakia has one of the most favourable tax regimes in the world with both personal and corporate tax a flat 19% and no withholding tax on dividends. You can either deduct a flat 25% in respect of expenses against rental income or you can deduct depreciation, loan interest, real estate taxes, maintenance etc.

After two years, the sale of your residential apartment is CGT free and after five years the sale of other private real estate is CGT free. Donation tax and inheritance tax were eliminated as of January 1, 2004. The real estate transfer tax was eliminated as of January 1, 2005.