Amendment to the Tax Code To Be Considered by the Senate

The Tax Code amendment moved forward in the legislative process. On 12 February 2020, the Chamber of Deputies approved the bill in the third reading. The bill was subsequently referred to the Senate where it is to be considered. The discussion was planned to be held on 18 March 2020 in the 17th meeting of the Upper House of the Parliament; however, given the current circumstances, it may be postponed. Selected amendments having an impact on the latest wording of the bill are outlined below.

Practically all of the basic clauses of the proposed law were preserved during the legislative process. The most essential ones include introduction of prepayments for an indisputable portion of excessive VAT deduction and the payment of the excessive VAT deduction within 45 days (instead of the current 30 days). The planned introduction of electronic financial administration through the MOJE daně (MY taxes) portal also remained unchanged.

Moreover, the bill includes simplification of the tax audit commencement and an option to switch from the process to remove doubts to a tax audit at any time during the tax proceedings. Significant changes proposed also include a review of the current sanction system with certain sanctions being reduced. The bill also keeps a change in the clauses on tax identification numbers and the related introduction of an option for individuals to request their own identifiers that should replace the currently used birth certificate numbers.

The original amendment to the Tax Code proposed by the Government included cancellation of the toleration period for filing income tax returns. The Chamber of Deputies, however, did not pass this change and the liberation period is retained in the bill to be considered by the Senate.

We will monitor discussions in the Senate and keep you informed of the final wording of the Tax Code amendment.

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