Austria: 12 points!

Attractive for investors 

Austria's geographical location alone makes it an ideal location for a company – namely in the heart of Europe, serving as a bridgehead between East and West and a gateway to 760 million potential customers. The country offers optimal access to the Eastern and South-Eastern European markets. More than 380 CEE headquarters have already been established in Austria.  

Companies and their employees benefit from the prevailing political, personal, economic and legal security in Austria. The productivity of the workforce is 10% above the EU average, and Austrian employees rank third in the world when it comes to motivation. There is an average of 21.5 days of strikes annually in Europe per 1,000 employees compared to only two days of strikes in Austria.   

Austria has a very well-trained workforce. The higher technical colleges (HTL) and commercial academies (HAK) fuse classroom teaching with business training and enable practice-oriented learning. Students are prepared to meet the requirements of the business world at universities of applied sciences, 22 public and 12 private universities. This particularly applies to newer fields such as artificial intelligence, autonomous systems, bioinformatics, cybersecurity, data science and power electronics. This offering is complemented by internationally renowned Austrian research centres.  

In the latest IMD World Competitiveness Yearbook, Austria is ranked second and third respectively in the categories “Apprenticeships” and “Employee training”, fifth for “Attracting and retaining talents” and seventh in “Labor productivity”.  

Research and development activities are actively supported by various programmes. For example, companies can apply for direct research funding from the relevant initiative of the Austrian Research Promotion Agency (FFG). Moreover, a research premium of 14% can be claimed for costs not covered by direct funding. A “migration allowance” is an additional incentive for foreign scientists and researchers. The 30% tax allowance limited to a period of five years applies to all income from their scientific activities.   

The Austrian R&D/GDP ratio, which equalled 3.22% in the year 2023, showed a 71% increase in the years 2000 to 2020, whereas the EU average only rose by 23%. 51.5% of all Austrian R&D expenditures are from foreign companies.  

The country features a business-friendly tax system. The corporate income tax rate was reduced to 23% on January 1, 2024. Furthermore, there is no trade, wealth, inheritance or gift tax.  

The points mentioned above provide just a few of the answers to the question: Why invest in Austria?  

Simple founding procedures for startups   

Approx. 3,400 startups have been established in Austria since 2012. According to the EY Start-up Barometer, startups in Austria attracted investments of € 695 million in 2023. Some 30,000 people are employed by startups.    

A new legal entity has been created to facilitate the formation of new companies. The Flexible Kapitalgesellschaft (FlexKapG or FlexCo), combining features of the limited liability company (GmbH) and public limited company (AG), has been in existence since the beginning of 2024. The minimum capital contribution is only € 10,000, of which only half must be paid in cash. Once the company has been set up, the paid-in share capital may be used for business purposes.  

The FlexCo enables employees to participate in the company's success – and thus retain skilled workers - through “enterprise value shares” (UW-A) alongside conventional shares. The enterprise value share with a minimum nominal value of 1 cent is the basis for employees to participate in the balance sheet profit or liquidation proceeds in proportion to the capital contribution. There is no obligation to make additional contributions and no default liability.  

Foreign companies interested in setting up a branch office in Austria can obtain free advice from the Austrian Business Agency (ABA), for example on the right legal form for the new company. The ABA provides assistance with practical or legal problems by providing location know-how and networking expertise.    

Proportion of women on supervisory boards  

Women are still underrepresented on management and supervisory boards in Austria compared to their share of the population. However, this is set to change. Initial successes are already perceptible, as showcased in the Women's Management Report 2024.  

The Act on Equality Between Women and Men on Supervisory Boards (GFMA-G) valid as of the beginning of 2018 stipulates that supervisory boards of publicly traded companies or firms with more than 1,000 employees must consist of at least 30% women and 30% men under certain conditions. New appointments to the board are invalid if this quota is not achieved.  

In the meantime, the proportion of women on the supervisory boards of companies covered by his law has risen from 22.4% in January 2018 to 36.5% in January 2024. In the same period, the share of women in other listed companies grew much more slowly to only 20.3 %. 

Quality of life: Attracting skilled workers  

As a stable, secure and prosperous cultural nation offering a remarkably beautiful countryside, Austria offers its residents an excellent quality of life with a high recreational value. At the same time, the cost of living is comparatively low, so that ordinary citizens can also take advantage of the wide range of opportunities. These advantages make it easier for foreign professionals to decide to leave their home country to take on a new job in Austria. 

The capital of Vienna, home to about half of all new Austrian startups, is the second largest German-speaking city and continues grow at a rapid pace. The British magazine “Economist” named Vienna the most liveable city in the world for the third time in a row. The highest scores were achieved in the categories of stability, healthcare, education and infrastructure. In the current IMD World Competitiveness Yearbook, Austria was rated second and third in the categories “Quality of life” and “Medical assistance”.  

The excellent quality of Austrian research institutions alongside their close cooperation and networking with universities and companies are particularly attractive for researchers.