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FinMin ups tax prognosisBusiness in short
30 Jun 2014 Compiled by Spectator staff Business
THE STATE’S revenues from tax and payroll tax collection should be €290 million higher this year than estimated by the Finance Ministry in its February analysis. The main reason is better collection of the value-added tax (VAT), but also higher revenues from corporate taxes.
Regarding VAT, Finance Minister Peter Kažimír praised the “successful fight against tax evasion”.
Kažimír stressed that the effective VAT rate has been rising for six quarters. At the moment, it stands at 14.1 percent. VAT in Slovakia is currently set at 20 percent, with certain goods, like medicine and books, having a reduced rate of 10 percent. The effective tax rate means that the state, due to tax evasion, in fact collected an amount as if the rate were actually set at 14.1 percent, TASR wrote.
Kažimír also praised the income from the corporate tax, which was elevated to 23 percent as of 2013. The ministry increased its October forecast of this tax for this year by more than €80 million.
The Finance Ministry expects further increases in tax revenues over the next few years. The prognosis for 2015 and 2016 has been upped by €200 million, while the estimate for 2017 is €145 million more.
The actual collection of VAT may eventually be even better. The forecast still does not include the positive risk from the recently adopted measures to further suppress tax evasion. The most significant is the introduction of ledger statements, the SITA newswire wrote.
However, the Finance Ministry is not so optimistic when it comes to collecting taxes from the self-employed.
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