Czech Ministry of Finance Proposes VAT Act Amendments to Align with EU Law and Practices

The Czech Ministry of Finance announced a draft bill to amend the VAT Act to align with EU law and reflect practical knowledge and case law.

Key measures in the bill include:

• Small businesses in other EU countries with turnover under 2 million Czech korunas per calendar year won’t be considered VAT payers in the Czech Republic, and vice versa for small Czech businesses in other EU countries.
• Businesses exceeding 2 million korunas in turnover during the year will become VAT payers from January 1 of the following calendar year, and immediately if turnover in the EU exceeds 100,000 euros.
• The period for calculating the 2 million koruna threshold will change to a calendar year from 12 consecutive calendar months.
• Clarifications will be made regarding the application of reduced VAT rates to construction works, expanding options for bad debt, and refunding VAT in cases of unjust enrichment.

Source: news.bloombergtax.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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