Czech Republic: Tax priorities of the Czech EU Presidency

The Czech Republic will focus on several tax areas during its EU Presidency

The Czech Republic will focus on several tax areas during its EU Presidency

According to the Ministry of Finance, the Czech Republic will focus on the following tax areas during its EU Presidency:

  • Simplifying the tax system and reducing the number of unjustified tax exemptions
  • Preparing an amendment to the EU Directive on Taxation of Energy Products and Electricity and its adaptation to current climate targets
  • Simplifying and modernizing valued added tax (VAT) rules to reflect the development of digitalization and fight tax evasion more effectively
  • Setting the taxation of the digital economy (Pillar One) and implementing the OECD Global Agreement on Taxing Multinational Enterprises (Pillar Two) into the EU legal framework
  • Updating the European list of non-cooperative jurisdictions for tax purposes

Negotiations around an amendment to the energy directive—aimed at introducing a new tax rate structure based on the energy content of fuels and electricity and their impact on the environment while also extending the tax base by including more products and removing existing exemptions (e.g., for kerosene used as fuel in the aviation industry and heavy oil used in the maritime industry)—has been complicated by the current energy crisis as many member states are concerned about its impact on maintaining EU competitiveness and its consequences for households.

In addition, the European Commission is finalizing a directive laying down rules to prevent the misuse of shell entities for tax purposes and a directive on a debt-equity bias reduction allowance. Both may be adopted during the Czech Presidency. 

Read a July 2022 report prepared by the KPMG member firm in the Czech Republic 

 

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