News in brief, December 2021

​DOMESTIC NEWS IN BRIEF

• The application for a VAT refund in Great Britain for the first half of 2021 must be filed by 31 December 2021. The UK VAT refund period is not the calendar year but the fiscal year from 1 July to 30 June, and the application must be submitted no later than six calendar months after the end of the fiscal year.
• A decree amending certain decrees on submissions via prescribed forms in tax administration was published in the Collection of Laws (No. 437/2021 Coll.).
• An amendment to the Valuation Decree was issued under No. 424/2021 Coll.
• An amendment to the government decree on the minimum wage, on the lowest levels of the guaranteed wage, on the definition of a difficult work environment, and on the amount of extra pay for work in a difficult work environment was published under No. 405/2021. The minimum wage shall increase to CZK 16,200 from 1 January 2022.
• An overview of the changes from 1 January 2022 within the competence of the Ministry of Finance can be found here.
• The financial administration issued its Information on the Application of Section 38zh of the ITA relating to the Application of Tax Losses as Items Deductible from Taxable Income.
• The financial administration issued its updated Information for Taxable Persons not Established in the CR (VAT registration and other selected tax obligations).
• A government decree on the permissible level of public aid in the cohesion regions of the Czech Republic was published in the Collection of Laws under No. 428/2021.
   

FOREIGN NEWS IN BRIEF

• The European Parliament subcommittee on tax matters (FISC) released a draft report on the establishment of a European withholding tax framework, to be prepared in legislative form by the end of 2022. The framework should find a balance between tackling fraudulent practices leading to non-taxation and inappropriate tax refunds and the need to ensure the reduction of double taxation for enterprises and investments. The framework should also introduce a system to ensure that all dividend, interest, and royalty payments out of the EU are taxed at a minimum effective rate and a harmonised EU procedure for all member states in respect of withholding tax refunds.
• The tax bill implementing the Polish Deal tax package was signed by the Polish president and should become effective on 1 January 2022. The bill includes significant corporate income tax changes such as a new Polish holding company regime, a minimum corporate income tax, provisions limiting the shifting of the profits to related entities in low-tax jurisdictions, innovation tax reliefs, and a reform of Polish transfer pricing rules.