Wednesday, 23 April 2014

Companies welcome VAT resolved

27 December 2012

Prague, Dec 21 (CTK) - Companies in the Czech Republic have welcomed clearing of the situation around the new VAT rates as President Vaclav Klaus Friday signed a tax package raising VAT rates by one percentage point to 15 and 21 percent as of January.

This means for Czech companies that they do not have to prepare several possible scenarios and can draw up new price lists and invoices for their buyers.

Chemical producer Spolchemie was thinking about cutting holidays of key employees in accounting in January due to the VAT changes. Now the employees can be calm.

"It is good that it has been signed already now, there should be enough time in the last week to prepare it. And we are also glad that the situation around VAT is clear," Spolchemie's spokeswoman Marie Logrova told CTK this afternoon.

After the adoption of the tax laws by the Chamber of Deputies on Wednesday, everyone was waiting what the president will do. If the approval process took a longer time, earlier-adopted single VAT rate at 17.5 percent would be valid as of January and the proposed VAT rates would come into force later in the year.

Glassworks AGC personnel director Libor Sehnal is happy about the president's decision to sign the legislation.

"It is certainly better than if the change was made in the course of the year. So this is good news but still, the whole change in VAT was simply made at the last moment and too late," he said.

Owing to VAT, the company feared it might be unable to invoice goods correctly as of January. The last week in December will therefore be hectic, Sehnal added.

Among the companies which expected potential additional costs in the order of tens of millions of crowns were mobile operators which until Friday had to prepare both scenarios for January - 17.5 percent as well as 21 percent instead of the current 20 percent.

Telefonica CR will make public its new price list based on the 21 percent rate on its website Friday. Its spokesman Hany Farghali said that part of the tariffs would remain the same. In other tariffs, there will be changes in charges per minute of calling or the monthly lump fee.

T-Mobile will include the higher VAT rate in most tariffs but the basic price without VAT will be cut so that the end price for clients remains the same, said its spokesman Jiri Janecek.

"We are glad that the president has resolved the situation, we can now work with only one scenario. This will make our work much simpler," said Vodafone spokeswoman Alzbeta Houzarova.

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