TAX FOUNDATIONS
The Czech Republic has a strategic central location in Europe with many possible points of access for both western and eastern markets.
The tax system is modern and has already by in large been adjusted to comply with EU guidelines. The tax system was amended on January 1, 1993 in keeping with the principles of the Western European tax system. The interim completion of the development anticipated the assumption of appropriate EU guidelines as of May 1, 2004. The following types of taxes exist:
- Income tax for natural persons
- Income tax for legal persons (corporation tax)
- Purchasing tax
- Consumption tax
- Real estate tax
- Inheritance, endowment and real estate transfer tax
- Road tax
In contrast to the German taxation process, in the Czech taxation process, self-assessment is generally used. The tax payer is obligated to calculate, file, and pay his taxes himself without an assessment from the Inland Revenue service.
TAX FOUNDATIONS
The Czech Republic has concluded double taxation agreements with 50 countries. The DTA concluded with Germany in 1980 regulates the trans-national circumstances in a similar manner to the OECD Model Convention.
Tax payers in the countries of Western Europe often watch in astonishment, rendered speechless at the creativity with which the tax authorities invent new taxes. In contrast, the taxation rates in the Czech Republic and other acceding countries are moving in the opposite direction.
An example: the rate of taxation for the income tax of legal persons was 31% in 2003, only 28% in 2004, 26% for 2005, and in 2006 it sank to 24%. This was the reason that many companies from Western Europe moved activities to the Czech Republic. And one should not forget the subsidies which flow there from the EU coffer!
We are integrating a modern office centre into the Chateau Ropice project: with modern office and secretarial services and the most modern communications technology. It is not necessary to go to Prague! The costs here are lower; it is relatively easy to find highly qualified employees for lower wages than in the capital city.
