Unitas to follow flat-tax in Slovakia

This new reform of the tax system shall result in further simplifications for all enterprises. In future only one governmental institution will handle all tax payments.

Presently the Slovakian tax system consists of the corporate income tax, which all enterprises whose head-offices are located in Slovakia are subject to, and the following other taxes: income tax, turnover tax, exercise duties, real estate duty, motor vehicle tax, local taxes and administrative fees.

Now Slovakia’s Minister of Finance, Ján Počiatek, plans a new reform by introducing ”Unitas” (Latin for: unit) and simplifying the current tax system at the same time: one governmental authority collects all tax payments from the enterprises.

The first step to be taken is to combine the customs- and tax authorities. Thereafter the second step will integrate the social insurance in this institution till 2012. Raising contributions is not being considered at the moment.

The aim of restructuring Slovakia’s tax system is to re-position the country as a low-tax country and to make it more attractive for company investments by simplifying taxation. Already when the flat tax system (common tax rate: 19 per cent) was introduced shortly before Slovakia’s EU-accession, the government launched a real investment booms. Five years after this an economic growth of 35 per cent could be achieved.