Information on Published Amendments to the Income Tax Act

• The changes concern an amendment to the Income Tax Act, which is published in the Collection of Laws under No. 304/2009 Coll. (this amendment was added to the draft amendment to the Act of Administration of Taxes and Fees; Parliamentary print no. 387). Under this amendment, a transport flat rate in the amount of CZK 5,000 was added to the Income Tax Act. The effectiveness of this amendment was changed and commences as of 1 January 2010, while the amendment to the Income Tax Act shall apply to the tax period beginning in 2009, pursuant to transitory provisions. The amendment to the Income Tax Act was adopted on the basis of a parliamentary amendment, but the terminology thereof is not clear. Negotiations between the representatives of the Ministry of Finance and Chamber of Tax Advisers of the Czech Republic will take place in mid-September to clarify the legal interpretation of the new amendment.
• Furthermore, an Amendment to the Act on Compulsory Labelling of Spirits was published in the Collection of Laws (Parliamentary print no. 515), to which another amendment was proposed by deputies in the second reading (this amendment was published in the Collection of Laws under No. 289/2009 Coll.). Based on the Amendment to the Act on Compulsory Labelling of Spirits, the flat rate for tax-deductible costs of natural persons-entrepreneurs has been changed. The flat rate remains at 80% for natural persons-entrepreneurs with income from agricultural production, forestry and water management whereas the flat rate is newly increased to 80% for natural persons-entrepreneurs with income from the trade businesses. Other natural persons-entrepreneurs may newly apply the flat rate of 60% of their income value. This amendment to the Income Tax Act shall be applicable for the taxation period beginning in 2009.
• In addition to this, a direct amendment to the Income Tax Act, which establishes extraordinary tax depreciation, has been published the Collection of Laws under Act No. 216/2009 Coll. The date of effectiveness of this amendment is set for the date of publication and special tax depreciation can be applied to property as defined in the Income Tax Act and acquired in the period of 1 January 2009 to 30 June 2010.
• The President returned the amendment to the Income Tax Act, which is included in the Act on the Promotion of Economic Growth and Social Stability, to the Chamber of Deputies and the Chamber of Deputies shall vote thereon during its last meeting commencing on 8 September 2009. The President returned it on the ground of the regulation of the so-called “car scrappage bonus”, which would have been implemented thereby. The actual Act on the Promotion of Economic Growth and Social Stability is contained in the part implementing extraordinary tax depreciations and is the same as the rules contained in Act No. 216/2009 Coll.

A hidden Amendment to the Act on Administration of Taxes and Fees reduces the period for storing documents from 15 days to 10 days and was published as part of Act. No. 218/2009 Coll., pursuant to which the Code of Civil Procedure and several other laws were amended. Reducing the time-period for storing documents results in a shorter period in which the legal fiction of delivery is deemed to occur. Act No. 218/2009 Coll. came into the effect on the date of its publication (20 July 2009), but the amendment to the Act on Administration of Taxes and Fees, included in part ten, occurs as of 1 January 2010.