In an effort to help economic subjects to overcome the emergency caused by COVID-19, the Czech Ministry of Finance proposes to extend the so-called Liberation Tax Package. The changes have already been approved by the Government and the proposal was sent to the Chamber of Deputies, which will deal with it at an extraordinary meeting. The proposed amendments are as follows:
- Waiver of June tax advance payment on both personal and corporate income tax. On adoption of this proposal, personal and corporate income tax advance payment that are due on June 15th, 2020 would not be paid by the taxpayers.
- General waiver of a fine for late filing of the real estate acquisition tax return or for late payment of the real estate acquisition tax or advance payment. The waiver should apply to all late filed tax returns with a filing deadline from March 31st, 2020 to July 31, 2020. The real estate acquisition tax return could be filed by 31 August 2020 at the latest, without the threat of a penalty. In such cases, the late payment interests or interest on retention of the real estate acquisition tax would be waived. In fact, all taxpayers would thus be automatically allowed to file a tax return on the acquisition of houses, flats, land, garages, etc. and pay the tax liability maximum five months later.
- Introduction of the tax loss carryback institute. By approving this adjustment, both corporate and natural person taxpayers would be entitled to reflect the tax loss suffered for the 2020 tax year in their tax returns for tax years 2019 and 2018. The tax loss would be utilized through an additional tax return for tax year 2019 or 2018, whereby taxpayers would incur a refundable overpayment for the 2019 or 2018 tax year in question. The institute of the retroactive application of tax losses should therefore have a positive impact on the cash flow of the taxpayers concerned.
- Suspension of the obligation to electronically record sales for entities in all phases of EET. The Ministry of Finance proposes a complete suspension of electronic sales recording for the period of emergency and the following three months. No taxpayer will have to record sales and the obligation to record sales will not be inspected in any way. The proposed amendment affects all taxpayers subject to electronic sales recording, irrespective of the stage from which they are obliged to record sales.