The Ministry of Finance has published a draft amendment to the income tax law of the Czech Republic for requiring comments. Among the proposals in the draft bill are measures that would:
- Continue the tax rates and tax base for individual income tax, with the impact that the “super-gross salary and a solidarity tax surcharge” would carry on to apply
- Cancel or limit tax exemptions of some employee benefits
- Initiate a rule for individuals to notice the amounts of their tax-exempt income overstepping a certain threshold amount
- Change the transfer pricing rules to limit a choice to deduct the tax base unless settlement between the related parties is reached simultaneously
- Propose a new tax relief for income in case of a property benefit with interest-free loans
- Fix the current income tax rate of 5% that uses for investment funds to only certain “basic investment funds” including investment funds in the form of a mutual fund, a trust, and certain other funds, depending on the structure of their investors
- Given that a finance lease payment is to be taken into account as a tax-deductible expense when certain arm’s length standards are fulfilled
- Insist stricter conditions on when costs can be considered tax-deductible
