Global

Details

  • Service: Tax, Global Indirect Tax, International Executive Services, Global Compliance Management Services
  • Type: Regulatory update
  • Date: 12/22/2012

Czech Republic - Increased VAT rates, other changes in 2013 

December 22:   The Czech Republic’s president approved austerity measures and technical amendments to value added tax (VAT) law, and the VAT changes—including increased rates of VAT—are effective beginning 1 January 2013.

Other changes concern individual income tax, withholding tax, and excise tax.

VAT changes

The VAT changes include measures providing for:


  • A one percentage point increase in the VAT rates—the standard VAT rate increases to 21% and the reduced VAT rate to 15%—in 2013–2015
  • More situations when the customer will be liable for paying the VAT
  • An extended period of time after which the transfer of real estate will become “VAT exempt,” from three to five years
  • Use of the calendar month as the primary VAT period for all taxpayers (a quarterly period may be available for certain taxpayers)
  • Modifications to the electronic format rules for tax documents, and requirements to file VAT returns electronically beginning in 2014
  • Opportunities to request binding rulings from the tax authorities as to whether a supply of scrap metal or waste is / is not subject to local reverse charge
  • An election to register as a person identified to tax (osoba identifikovaná k dani) instead for full VAT registration
  • Modifications to the VAT exemption rules for insurance and reinsurance activities

Income tax changes

Other changes include:


  • Limits on lump-sum expense deductions for individual (personal) income tax
  • An increase in withholding tax on passive income from 15% to 35% (dividends, interest, royalties) when “tax haven” jurisdictions are involved
  • A 7% “solidarity increase” in individual income tax on income in excess of 48-times the average wage in 2013–2015
  • Repeal of the basic individual income tax allowance for pensioners in 2013–2015
  • Concerning health insurance premiums, repeal of the cap on such premiums, 2013-2015
  • An increase in the rate of the real estate transfer tax, from 3% to 4%
  • Concerning excise taxes, restrictions on the “green diesel” preferential tax treatment in 2013, and then full repeal in 2014

Read a December 2012 report [PDF 107 KB] prepared by the KPMG member firm in the Czech Republic: Financial Update: Special Edition



For more information, contact a KPMG tax professional in the Czech Republic:


Petr Toman

+420 222 123 602


Ladislav Malušek

+420 222 123 521



©2012 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. All rights reserved.


The KPMG logo and name are trademarks of KPMG International.


KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever.


The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.


Direct comments, including requests for subscriptions, to go-fmtaxnewsflash@kpmg.com.
For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at:

+ 1 202 533 4366

1801 K Street NW
Washington, DC 20006.
 

Share this

Share this

Subscribe

Subscribe to receive the latest TaxNewsFlash email alerts (you must select the option for TaxNewsFlash)


Already a Subscriber? Login


Not a member? Subscribe now

Contact us

TaxNewsFlash by region


TaxNewsFlash home

TaxNewsFlash-Europe by country


TaxNewsFlash-Europe home