Civic groups can avoid new transaction tax—if they act fast

From April 2025, businesses in Slovakia will face a new financial transaction tax of 0.4 percent per payment, capped at €40. ATM withdrawals will incur a doubled rate of 0.8 percent, with no upper limit. Meanwhile, a €2 annual fee will be levied for the use of payment cards by entrepreneurs.

The tax, part of a fiscal consolidation package, was initially set to include non-profits and charities. However, after parliamentary revisions, the non-profit sector—often targeted by Robert Fico’s government—has been exempted entirely.

Finance Minister Ladislav Kamenický (Smer) initially suggested refunds for select non-profits, while Labour Minister Erik Tomáš (Hlas) proposed excluding public-benefit organisations. Yet, with over 80,000 non-profits in Slovakia, determining eligibility proved unfeasible. Instead, a blanket exemption for the sector was introduced, Denník N writes. 

Civic associations, foundations, and non-profit organisations will, however, be exempt from paying transaction tax only if they meet specific conditions, such as those related to their legal form and type of activity. They must also notify the bank - by March 2025 - that they are not required to pay the tax. 

“Each bank may have its own procedure. You need to contact the bank, request a sample notification, and obtain a list of documents required to verify the legal status and activities of the non-profit organisation,” tax advisor Marcela Bošková told Denník N. 

The law does not address situations where a non-profit delivers its notification to the bank late. However, without the notification, the bank will deduct the tax and will only stop doing so the day after the notification is received.

Further exemptions

Additional exemptions cover organisations like cultural institutions and tourism bodies that operate within public spending limits but not primarily for profit. 

Critics, including the European Central Bank (ECB), have raised concerns about the tax’s impact on monetary policy and financial stability. In response, operations tied to the National Bank of Slovakia’s monetary policy will be exempt, Denník N adds.

Despite these changes, the transfer of payments such as employee salaries remain taxable. However, several other payment operations have now been added to the list of exceptions.  

Also, if companies pay from accounts in domestic banks, these banks will collect the tax. If payments are made from foreign banks, the companies will need to declare them in their tax returns.