Tax and legal news

With respect to the conflict in Ukraine, an amendment to the Income Tax Act has been approved that introduces new possibilities in respect of tax relief regarding donations provided by tax payers to Ukraine.

The above-mentioned new government bill amending the Income Tax Act proposes support for owners of low-emission vehicles. The bill suggests reducing the amount of taxable income, which increases the tax base of employees who use company cars for private trips.

In the light of the dramatic increase in fuel prices this year, the Ministry of Finance has issued a general waiver to all entities regarding 2022 road tax deposits.

On the basis of an amendment to the Income Tax Act effective from 1 June until 30 September 2022, the excise tax on diesel and unleaded petrol will be reduced by CZK 1.50 per litre as a means of mitigating the current rise in fuel prices.

The Ministry of Finance has submitted its amendment to the VAT Act to the comment procedure. The bill should increase the yearly turnover for mandatory registration for VAT to CZK 2 million (EUR 85,000) and it should become effective from 1 January 2023.

The Court of Justice of the EU was dealing with the question of whether the permanent establishment of a parent company can be created for VAT purposes in another EU member state (where the subsidiary resides) if the subsidiary provides the parent company with marketing and other services (e.g. regulatory, advertorial and representative services), and those services are invoiced monthly.