Eastern Europe heads OECD reform drive in 2017 World Bank report

November 2016

Now in its 14th year, the World Bank Doing Business Report assesses regulations affecting domestic firms in 190 economies, ranking each on the basis of 11 criteria impacting the ease of doing business in any jurisdiction. Russell Bedford member firms have again assisted in the compilation of the report's Paying Taxes survey, contributing information on tax regulation, recent reforms and the comparative compliance burdens on entrepreneurs and businesses worldwide.

Poland leads performance among OECD countries, having implemented three separate reforms over the past year, improving procedures in dealing with construction permits, accessing electricity, and resolving insolvency. The Czech Republic made starting a business easier by reducing the cost and the time required to register a company in the commercial courts, and Hungary improved regulation governing contract enforcement, as well as introducing reforms in tax regulation.

In terms of tax compliance requirements, however, all three countries remain far behind their other OECD peers. Businesses in the Czech Republic are having to spend an average 234 hours per year on their tax submissions, those in Hungary 277 hours, and those in Poland 271 - against an OECD high-income average of 163.4.

Andrzej Dmowski, managing partner, Russell Bedford Poland Sp. z o.o., commented: "It is gratifying to see East European countries recognised for their efforts in promoting business reform. But this year's Paying Taxes survey makes all too clear the extent to which tax regulation, in particular, is putting our businesses at a genuine disadvantage against their other OECD peers."

Jiří Nekovář, senior partner at Russell Bedford member firm Euro-Trend s.r.o., Prague, added: "This year's report highlights a very marked disparity between East and West European countries in terms of their tax compliance obligations. It is clear that major and continued efforts are necessary if these countries are to become genuinely competitive against West European economies."