Czech Republic: Bill for digital services tax not approved
Any proposal for a digital services tax would have to go through the entire legislative process again.
Any proposal for a digital services tax would have to go through legislative process again
The Czech Chamber of Deputies did not approve a bill proposing a digital service tax before the end of the parliamentary term.
Hence, any proposal for a digital services tax would have to go through the entire legislative process again if the new government wants to introduce a tax on digital services.
Some observers believe that the introduction of a bill for a digital services tax would be unlikely given the agreement reached on new international taxation rules at the G20 level because it also includes a commitment by participants not to apply or introduce new digital taxes.
The government submitted the digital services tax bill to the deputies in 2019. The new tax was to apply to income from targeted advertising and income from the sale of data when the source of the income was a Czech user using a digital interface operated by a foreign company. The tax was also to apply to foreign platform operators’ income generated from the mediation of sales of goods or services in the Czech Republic.
The bill passed through its first and second readings, but time ran out before the third reading.
Read a November 2021 report prepared by the KPMG member firm in the Czech Republic
The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 3712, 1801 K Street NW, Washington, DC 20006.