Host countries, especially developing countries, often grant tax incentives in order to attract foreign capital of multinational companies (MNCs), expecting positive effects of foreign direct investments on their economic development. Also, there is an opinion dominant in the literature that MNCs have enough power to achieve considerable tax incentives in negotiations with host country. Considering that one MNC was granted considerable tax incentives from the Republic of Serbia (RS), the paper examines whether subsidiaries of MNCs have more favorable tax treatment of recorded income than domestic companies in the RS. Statistical analysis outcomes show that subsidiaries of MNCs do not have significantly lower income tax burden than domestic companies suggesting that tax incentives granted to MNCs from the RS are an exception rather than a rule. In addition, research showed that subsidiaries of MNCs primarily use tax incentives that are equally available to domestic companies, such as tax incentives for investment in fixed assets. Research results are robust to changes of income tax burden measures.