Working intl students, graduates paid EUR 11 mln in taxes in Estonia during academic year

  • 2019-12-11
  • BNS/TBT Staff

TALLINN – Foreign students paid eight million euros in income and social tax in Estonia during the past academic year, on top of which international students who graduated the year before contributed almost three million euros, it appears from a study prepared by Statistics Estonia for Archimedes Foundation on the participation of international students in the Estonian labor market and its impact on the economy.

The share of international students who work besides studying has increased significantly over the last three years. Half of them continue working in Estonia also after receiving a diploma, Statistics Estonia said.

In the academic year 2018/2019, international students in Estonia paid 2.4 million euros in income tax and 5.6 million euros in social tax. In the same academic year, international students who graduated in 2017/2018 paid 0.9 million euros in income tax and 1.9 million euros in social tax in Estonia.

"Foreign students who get accustomed to life in Estonia during their studies could contribute to the local labor market and economy also after graduation. Considering that the money foreign students earn is also spent in Estonia, it can be estimated that, in the previous academic year, international students contributed around 20 million euros to the economy," Eero Loonurm, head of the international marketing agency at Archimedes Foundation, said.

Loonurm added that one of the indicators in the strategy for the international promotion of Estonian higher education is employment in Estonia after graduation. The objective is that 30 percent of international students in master's or doctoral studies would continue working in Estonia.

Kadri Rootalu, data researcher at Statistics Estonia, explained that by combining databases Statistics Estonia's experimental statistics team can study data on student employment in more detail, for example, by level and field of education.

"It came as a surprise that international graduates make such a big contribution in information and communication as well as manufacturing enterprises," said Rootalu.

There are more than 5,000 international degree students in Estonia. One in ten students in Estonian higher education institutions comes from another country. Each year, study opportunities in Estonian higher education institutions are promoted abroad.

It appears from the survey that approximately half of international students in Estonia work besides studying, compared to over 80 percent of local students. The share of international students who stay in Estonia for work after graduation has slightly increased in the last two years: it was 45 percent in 2017 and 51 percent in 2018.

The share of working international students is smallest in integrated study program. Only a few international students in these programs work besides studying, as opposed to around 80 percent of local students. Compared to other levels of study, international students in bachelor's studies work less.

The share of international students with a master's or doctoral degree who worked immediately after graduation was 56 percent in the academic year 2016/2017 and 58 percent in 2017/2018.

The most likely to work besides studying are international students in information and communication technologies; engineering, manufacturing and construction; and business, administration and law, with two thirds of international students in these fields having worked in the academic year 2018/2019. Graduates in the same fields also stay in Estonia for employment more frequently than  others. A contributing factor could be that there are many enterprises offering an international work setting for graduates of these fields.

Compared to local students, international students are more likely to work in enterprises in foreign ownership.