It is a long-standing tradition that Austrian entrepreneurs and Austrian companies are free-thinking in their decisions on how to finance their businesses. The Austrian Supreme Court holds that it is up to an entrepreneur how to finance their business and it would violate constitutional law in Austria if that right was restricted. Therefore, Austrian tax law does not know any debt-equity ratios or thin-cap rules. Any interest payment is fully tax deductible regardless of whether it is paid to a domestic or foreign lender.
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