BUSINESS IN SHORT

Road tax to change radically

THE CURRENT system of tax on motor vehicles is changing radically. While pleasing transport firms, the Bratislava local government perceives the new tax as an example of growing nationalisation of local self-administration.

THE CURRENT system of tax on motor vehicles is changing radically. While pleasing transport firms, the Bratislava local government perceives the new tax as an example of growing nationalisation of local self-administration.

On November 26, parliament passed a bill unifying motor vehicle tax for the entire country as of the beginning of 2015 – unlike the current system when self-governing regions themselves set the tax – with environmental impact set as the decisive criteria.

The rates are set on the basis of the lowest rates, currently in the Banská Bystrica region. ČESMAD, the association of commercial transport firms welcomed the changes and said that expenses for transport firms would decrease.

In another big change, the collected taxes will become the income of the national government not local self-administration, as it is now.

The state promised to compensate for this loss to municipal budgets by increasing the share of individual income taxes going to local governments.

Bratislava regional Governor Pavol Frešo and the head of the Slovak Democratic and Christian Union (SDKÚ), reacted, saying the national government has started nationalising local self-administration, having made the first step towards effectively scrapping the de-centralisation of public administration in Slovakia. Frešo added that the self-governing regions are thus stripped of their power to decide on the sum of the single tax that was under their remit, and starting as of next year, the tax incomes of the regions will fully depend on governmental decisions.

“The recent development in self-administration in Slovakia unambiguously shows a discreet, but more intense, gradual shift from de-centralisation towards centralisation,” Frešo told the SITA newswire.

Out of eight regions, Bratislava profits from the road tax the most. Regional officials claim that the change will cost them €25 million over four years.

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