Taxes from international students and graduates in work exceed €10 million
International students and graduates who work in Estonia paid more than €10 million in taxes in the 2018/2019 academic year, a study by Statistics Estonia for the Archimedes Foundation found.
The study looked at the participation of international students in the Estonian labour market and its impact on the economy.
Results showed, for the previous academic year 2018/2019, foreign students paid €8 million in income and social tax in Estonia. International students who graduated the year before contributed over €2 million to the economy.
The study also showed the share of international students who work besides studying has increased significantly in the last three years. Half of them continue working in Estonia after receiving a diploma.
There are more than 5,000 international degree students in Estonia. One in ten students in Estonian higher education institutions comes from another country.
The most likely students to work alongside their studies are students in the information and communication technologies field such as engineering, manufacturing and construction; and business, administration and law. Two-thirds of international students in these fields worked in academic year 2018/2019.
More findings from the study can be seen below.
Head of the international marketing agency at Archimedes Foundation Eero Loonurm said: "Foreign students who get accustomed to life in Estonia during their studies could contribute to the local labour 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 to the economy,"
He 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.
Data researcher at Statistics Estonia Kadri Rootalu 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.
The Archimedes Foundation is an independent body established by the Estonian government with the objective to coordinate and implement different international and national programmes and projects in the field of training, education and research.
The study showed:
1. Approximately half of international students in Estonia work besides studying, compared to over 80 percent of local students.
2. The share of international students who stay in Estonia after graduation for work has slightly increased in the last two years: in 2017, it was 45 percent, and in 2018, it was 51 percent.
3. The share of working international students is smallest in integrated study programmes. Only a few international students in these programmes 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 the least.
4. The share of international students with a Master's or Doctoral degree who started worked immediately after graduation was 56 percent in academic year 2016/2017 and 58 percent in 2017/2018.
5. The most likely to continue working in Estonia after finishing their studies are international students studying at Tallinn University and Tallinn University of Technology.
6. The most likely to work besides studying are international students in information and communication technologies; engineering, manufacturing and construction; and business, administration and law. Two-thirds of international students in these fields worked in academic year 2018/2019. Graduates in the same fields also stay working in Estonia more frequently compared to others. A contributing factor could be that there are many enterprises offering an international work setting for graduates of these fields.
7. For years, international students have mainly worked in administrative and support service, accommodation and food service and information and communication enterprises.
8. Compared to local students, international students are more likely to work in enterprises in foreign ownership.
9. In the academic year 2018/2019, international students in Estonia paid €2.4 million in income tax and €5.6 million in social tax.
10. International students in information and communication enterprises contributed the most, in total income tax paid in the academic year 2018/2019 was €0.73 million. The contribution of foreign graduates was also the largest in this economic area.
11. In 2018/2019, international students who graduated in 2017/2018 paid €0.9 million in income tax and €1.9 million in social tax in Estonia.
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Editor: Helen Wright