Czech Republic: Status of digital tax proposal

Czech Republic: Status of digital tax proposal

A proposal for a digital tax has been before the chamber of deputies for several months now. As originally proposed, the digital tax would be effective from mid-2020, but that timeline has come and gone.

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The introduction of the digital tax is under consideration again.

Among other things, a proposal submitted to reduce the rate of the digital tax from 7% to 5% seemed to clear the way for the tax in June 2020; however, the official proposed rate is still at 7%. To reduce the rate by 2%, deputies would have to pass an amendment during the third reading.

The deputies did not have time to discuss a digital tax during the summer because the coronavirus (COVID-19) pandemic resulted in limited operation of the chamber. The related second-reading discussions did not begin until the second half of September 2020, and were soon terminated due to a lack of time. 

The effective date of the digital tax is not certain. One of the amending proposals filed by deputies suggests postponing the effective date to 1 January 2021. To achieve this goal, debate on the bill and related amending proposals in the chamber of deputies will have to conclude in the upcoming weeks.


Read an October 2020 report prepared by the KPMG member firm in the Czech Republic

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