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EU Tax Harmonisation Impact on the Central European Countries Tax Policies

EU Tax Harmonisation Impact on the Central European Countries Tax Policies. Lukas Moravec Department of Business and Finance Czech University of Agriculture in Prague. What will we speak about ?. Introduction EU tax policy background EU members tax harmonisation initiatives

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EU Tax Harmonisation Impact on the Central European Countries Tax Policies

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  1. EU Tax Harmonisation Impact on the Central European Countries Tax Policies Lukas Moravec Department of Business and Finance Czech University of Agriculture in Prague

  2. What will we speak about ? • Introduction • EU tax policy background • EU members tax harmonisation initiatives • CEC pre-entering tax reform initiatives • Conclusion • Discussion

  3. EU tax policy background • Indirect taxation is the main target of harmonisation • Direct taxation is the object of recommendations • Anti-money laundering activities • Decrease the labour tax burden • Abolish the cross-border tax barriers

  4. EU members tax harmonisation initiatives • Austria - leading harmonisation (low taxation, but not tax breaks supporting investment) - shifting taxation from small to big companies • German - five-year program reducing corporate and personal tax

  5. Czech Republic pre-entering tax reform initiatives • CR wishing to complete the indirect harmonisation till 2004 • reduce the list reduced rate VAT objects • decrease the VAT registration turnover limit • raise the consumption taxes rates • CR should reduce the corporate tax rate at 25 percent • tax holidays supporting investment

  6. CR obtained transition period till 2010 for • keeping reduced VAT for heat supplies and cigarettes • exemption of VAT registration under 35 000 EUR turnover • keeping reduced consumption tax at traditional home-made spirit and cigarettes

  7. Hungary pre-entering tax reform initiatives • started its tax reform as the first one of CEEC • strong Treasury and Financial and Tax Control Institute (also covering e-business) • known as a tax haven offering non-resident offshore companies

  8. Poland pre-entering tax reform initiatives • Code of Tax • corporate tax should be reduced at 20 percent till 2005 • personal income tax should be simplified and reduced • tax benefit for investors connected with direct taxation

  9. Conclusion • CEEC are on different level of tax policy harmonisation following the EU tax principles • some of CEEC can be called tax havens more (Hungary) or less (Czech) regulated by the Treasury • EU still not harmonised = opportunity for the CEEC to keep some tax exemption for investors under the conditions of respecting the anti money laundering principles

  10. Thanks for your attention

  11. Discussion Contact: moravec@pef.czu.cz

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