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Another tax liberation package waives default interest on selected taxes and some administrative fees

The Ministry of Finance is waiving default interest on VAT and road tax for entities in selected sectors of industry, and default interest and interest on deferred tax amount where the deferment of tax payment or payment of tax in instalments was granted for reasons related to the spread of the SARS-CoV-2 virus. For all entrepreneurs, selected administrative fees have also been waived. The tax liberation package comes in the form of a decision of the Minister of Finance.

The decision has been published in Financial Bulletin 38/2020. The waiver of default interest on selected taxes only applies to taxpayers whose prevailing portion of revenues between 1 June 2020 and 30 September 2020 was generated from one or several activities that have been banned or restricted by a government resolution between 22 October 2020 and 31 March 2021. These include, for instance: operation of restaurants and bars, organisation of concerts and other musical, theatrical or film shows, organisation of congresses and other educational events, organisation of trade fairs and other similar activities. For these taxpayers, the following shall be waived:
  • default interest on VAT for the taxable period of September, October, November and December 2020, and January, February and March 2021,  or for the taxable period of the third and fourth quarter of 2020 and the first quarter 2021;
  • default interest on road tax for the 2020 taxable period

provided that the tax to which the default interest relates is paid no later than on 16 August 2021. At the same time, the road tax prepayment payable on 15 April 2021 has been waived (although its waiver does not mean the tax itself is waived). The waiver is conditional upon the taxpayer notifying the appropriate tax authority of the fact that the prevailing portion of their revenues in the relevant period was generated from the defined activities. As regards VAT, this liberation package only waives default interest, not penalties for late tax assertions, meaning that VAT returns and VAT ledger statements still have to be filed within the statutory deadlines.

The decision also generally waives selected administrative fees (or, more precisely, extends the period for which administrative fees were already waived by the Finance Minister’s previous decisions). The waiver applies to administrative fees for applications for a waiver of default interest or interest on deferred tax amount, for deferment of tax payment or payment of tax in instalments, for tax debt-free or personal tax account balance confirmations; as well as to selected applications in the customs area, if filed between 1 January and 16 August 2021.
Finally, the decision waives (or, more precisely, extends the period for which it was already waived by the Finance Minister’s previous decisions) default interest and interest on deferred tax amount where the deferment of tax payment or payment of tax in instalments was granted for reasons connected with the outbreak of SARS-CoV-2 upon an individual application filed pursuant to Section 156 of the Tax Procedure Code. The waiver remains valid until 16 August 2021.