Act No. 31 / 1946 Coll.
Law on turnover tax
Valid
Effective from 01.03.1946
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31.
Law
of 21 February 1946
on turnover tax.
The Provisional National Assembly of the Czechoslovak Republic decided on the following Act:
I. Subject matter of tax.
Taxable deliveries, performance, own consumption and import.
(1) Dani is subject to:
1. domestic supplies and services carried out by an entrepreneur in return for payment within his undertaking. Which supplies and performances are considered domestic and what is understood by the domestic state under this law, the government shall establish a regulation. Where an undertaking is supplied as a whole, that supply shall be deemed to still be carried out within the undertaking;
2. the taking free of charge of articles from own household business or for other non-profit-making uses or for business employees (own consumption);
3. import of all items. The Government may, by regulation, provide that imports of certain articles, in particular raw materials, semi-finished products, machinery or apparatus, which are not produced or produced in sufficient quantities in the country, are not subject to tax or are subject to reduced taxes. The flat-rate regulation (Paragraph 19 (8)) may provide that imports are subject to a flat-rate payment which also replaces the regular or reduced turnover tax on imports, unless otherwise provided for in the Regulation. Transit shall not be subject to tax under the conditions laid down in the Regulation.
(2) It does not matter whether the delivery or execution is carried out voluntarily or in order to fulfil the obligation laid down by law, or on official order, if the delivery or execution has actually been carried out or deemed to have been carried out by law, whether physical possession has actually been transferred or not. A taxable supply shall also be deemed to be a taxable supply if the article becomes a representative or a letter (e.g. a bill of lading, a bill of lading or a bill of lading). Dani is also subject to auctions.
(3) The supply (performance) between the commission and the agent and the supply (performance) between the agent and the third person shall always be taxed separately in the agency's business, even if the agent has neither acquired possession nor ownership of the goods; The same applies if someone has his own name on a foreign account of the delivery or performance. In doubt, if it is the agency's ratio, after the conduct that someone procures on his own behalf on an account or the management ratio, it is assumed, if the taxpayer does not prove otherwise, that it is not the management ratio. Where a party to an occasional association procures a supply or performance on its own behalf on behalf of that association, the proportion between it and the other participants of the occasional association shall not be taxable supplies or performances. In the case of supplies (outputs) of mutual (e.g. in kind), then in cases where the subject is surrendered instead of payment, there are always two separately taxable deliveries (performances).
(4) The tax obligation (paragraph 1, No 1) also applies to supplies and services between the Czechoslovak State (hereinafter referred to as the State) and national or national undertakings, as well as to supplies and services between those undertakings.
The subject matter of taxable supplies.
(1) Dani is subject to delivery, including renting and smuggling:
1. movable things of material and energy, including water, gas, electrical current, etc. The supply of property-tight goods and supplies of other real estate accessories shall be subject to tax, whether sold or leased or implanted, even if this is done before they were separated from real estate. What applies to the whole shall also apply to the shares in them;
2. rights which are the subject of legal trade, in particular copyright, trademark and sample protection rights and other exclusive rights (licences, concessions, operating rights, etc.). Dani is also subject to an obligation to beg or to suffer, not to do or to renounce. However, Dani is not subject to the supply of rights associated with the possession of real estate, the right of construction and other rights which are calculated under the legal provisions on immovable property;
3. the set of items and rights referred to in Nos 1 and 2, except for real estate and related property, e.g. when selling, renting or smuggling businesses as units.
(2) Where the recipient of the supply is obliged to return to the supplier by-products or waste resulting from the processing of the delivered article, the delivery shall be limited to what remains to the recipient of the supply (e.g. fat in milk when the skimmed milk is returned, sugar in beet beet when the beet is returned). The re-supply of by-products or waste shall not be subject to tax. The same shall apply if the supplier receives, instead of by-products or waste arising from, or arising from, the processing of an article which he has supplied, by-products or waste of the same type obtained by the recipient of the supply by processing an article delivered by someone else.
Taxable performance.
(1) Dani is subject to: the performance of all types carried out in the Czech Republic, for example, the craft and industrial processing of materials (raw materials, semi-finished products, tovar) belonging to the client, all kinds of transport, goods and services, the performance of construction and installation enterprises, the performance of members of the liberal professions (lawyers, notaries, doctors, civil engineers and others), the performance of schools of music, language and other institutions of education, the performance of hotel businesses, pennies and others, including the business renting of furnished rooms, the brokering of information, barbers, etc.
(2) Where an entrepreneur supplies a substance (material) to him for the manufacture of an article, instead of an article to be made of it, another object of the same kind as that normally produced from such a substance, the subject of taxation shall be deemed to be the subject of taxation instead of the supply, provided that the payment for the making of an article is calculated as a work, regardless of the difference between the market prices of the substance received and the item delivered.
Supplies, performances, own consumption and exempt imports.
(1) The following shall be exempt from turnover tax:
1. deliveries in forced auctions. However, the exemption does not apply to flat-rate supplies (§ 19 (8));
2. export deliveries under the conditions laid down in the Regulation;
3. supplies of precious metals and other money-stamping mixtures under the conditions laid down in the Regulation;
4. the provision of credit and transfers of cash claims, in particular notes and cheques, cash deposits of all types, the issue and transfer of securities, with the exception of the securities referred to in § 1 (2), transfers of shares in social and social (cooperative), domestic and foreign legal tender of metal and paper; However, securities and foreign legal tender commissions (excluding those relating to the sale of lottery tickets) are subject to tax. The credit shall not be considered as a credit where the supplier, or who carries out the performance, is the recipient of the supply or the performance of the cost associated with the performance of the supply or performance;
5. supply and own consumption of Czechoslovak state financial monopolies;
6. supplies of valid unimpaired official prices. Deliveries of valid unimpaired postal prices are only exempted if they are carried out by Czechoslovak Post or by entrepreneurs to whom Czechoslovak Post has granted authorisation to sell postal prices;
7. the supply of water, the performance of scales and the performance of slaughterhouses (babysitting, feeding and slaughter of cattle), provided that such supplies and operations are carried out by the State or by public bodies in their own undertakings, and the supply of gas and electricity for public lighting. The supply of the same amount of electricity carried out during the tax period between power plants whose power lines are related shall also be exempt. However, the supply of electricity in excess of that quantity shall be subject to tax;
8. supplies and services under insurance contracts, subject to a charge pursuant to the Regulations of 15 September 1915, No 280 of, and in Slovakia pursuant to Article VIII / 1883 (tariff heading 89, No IV and in the charging rules), even if the relevant insurance contract is exempted under the specific provisions of this legislation;
9. re-deliveries of packaging where the trader returns to the supplier the packaging in which the supplier supplied the goods;
10. imports, in the cases and under the conditions set out in Sections 62 to 65, 87 and 105 of the Customs Act of 14 July 1927, No 114 Coll.; the flat-rate regulation (Section 19 (8)) may, however, be provided that imports are also subject to a flat-rate payment in these cases. Furthermore, imports are exempt in the cases and under the conditions laid down in Section 69 of the Customs Act; the exemption does not apply in cases where the flat-rate tax is flat-rate, unless it is expressly provided in the flat-rate regulation that imports are exempt from flat-rate duty;
11. performance for which the benefits of the tantium tax are paid;
12. supplies of pharmaceuticals, medical devices (including therapy devices), medical devices and tools, medical waters, supplies and services, which are responsible for the administration of medical baths, medical and obstetrics, if they pay for such supplies or services by the holders of public social insurance or by replacement internal facilities exempted by the relevant legal provisions, or if those supplies and procedures are carried out for persons certified of poverty. Under the same conditions, other supplies and services are exempt provided that they are carried out by medical and nursing institutions (including the institutions of the public social insurance holders and the institutions of the replacement internal facilities excluded by employers) and spa undertakings. In addition, the supply of medicines, medical devices (including therapy aids), medical instruments and instruments and medical waters shall be exempt from tax if they are carried out for public health and care institutions, public social insurance holders or institutions for replacement internal facilities of exempted employers. Finally, all supplies and services carried out by public health and care institutions in general classes, and supplies and services carried out by spa companies at a price reduced for social reasons, are exempt from tax if this reduction is at least 50% of the full price. Such exemptions shall not apply where the tax is flat-rate;
13. own consumption of naturals to fill in in kind;
14. own consumption of articles for the purpose of their charitable use. What is meant by charitable use, it shall establish a regulation;
15. supply and performance of the following associations for their members (communities, cooperatives and other associations):
(a) associations of farmers whose purpose is to jointly procure seeds, fertilisers, economic machinery and tools or other needs for the operation of the field economy, to promote livestock farming (cattle farming communities, bull farming, grazing communities and so on), or to promote other agricultural efforts together;
(b) associations of other entrepreneurs whose purpose is to jointly procure raw materials, aids and machinery for their members, where they use them for processing or for processing, or sell their members' products; and
(c) associations of farmers or other entrepreneurs whose purpose is to lend joint ventures or carry out the performance associated with the use of such ventures to assist members in the operation of the undertaking;
If their total turnover in the last preceding calendar year does not exceed CZK 200.000, and if, according to the statutes of these associations, the distribution of the net proceeds is not excluded and the proceeds are not actually distributed and if their activity under the statutes is also limited to members that can only be farmers or other entrepreneurs. The regulation shall determine what is understood to be the overall turnover. The exemption is not a fault if, according to the statutes or in fact, there are members of such associations of persons who are not the profession of farmers or other entrepreneurs, if the admission of such persons to the membership pursues the purpose of obtaining cooperation between persons able to procure the Federal Agenda (correspondence, book management, control, etc.), and if there are exceptional cases. Nor is exemption for a defect where, exceptionally, delivery or execution for non-members is necessary (such as from an official regulation or in the case of goods threatened with significant destruction). The exemption shall apply only to those supplies and performances carried out for members by which the associations fulfil one of the purposes referred to in points (a) to (c). The exemption shall not apply to supplies and operations carried out by associations of farmers or other entrepreneurs to process the goods of their members and to monetize the products resulting from such processing;
16. the supply and performance of domestic workers, carried out by themselves or by members of their family living with them in the common household, depending on the processing of materials which they receive from entrepreneurs to whom they pay the finished product and remnants of processed materials and from whom they receive only the agreed wage per piece for their work;
17. imports directly to the State and to those State-owned enterprises which do not belong to undertakings declared to be managed under the principles of commercial management. In addition, imports of medicines, medical devices (including therapeutics), medical instruments and instruments and medical waters are exempt from tax if they take place directly for public health and nursing institutions, public social insurance holders or institutions of replacement internal facilities of exempted employers. Further conditions for such exemptions shall be laid down in the Regulation. Such exemptions shall not apply where a flat-rate tax is charged unless it is expressly provided for in the flat-rate regulation. The exemption shall not apply to imports for enterprises nationalised or national;
18. performance relevant to the processing of movable goods and carried out in the country proven for abroad. The conditions for such exemption shall be laid down in the Regulation;
19. Supplies that take place in cases where, by law, the fee exemption is due because of fusion, merger or conversion of the legal department of certain undertakings. In cases where, on request, the Government may, for these reasons, grant an overall or partial exemption from fees, it may also grant a full exemption from turnover tax or may reduce that tax accordingly.
(2) The Government may, on a proposal from the Minister of Finance, after hearing the relevant central interest organisations in the Czech and Moravian-Silesian countries and in agreement with the Finance Officer, who will hear the central interest organisations in Slovakia, provide:
(a) in the case of supplies made in bulk in trade, the exemption, reduction or other tax relief, if the inter-trade degree is economically necessary or in the public interest, and if its transfer activity is jeopardised;
(b) in the case of supplies and transactions relating to articles imported, in cases where the exemption is due to be taken into account, the reduction thereof, after the total or partial deduction of the tax paid on importation (Section 1 (1) (3)), into the tax on the first domestic supply of the imported article;
(c) in the case of supplies and works relating to articles produced within the country and delivered to the domestic country, in cases where the exemption or reduction of the exemption is due, where the goods of domestic origin are more burdened than imported articles of the same or similar type, or where the competitiveness of the industry processing these articles so requires when exported;
(d) in cases where a tax reduction or other relief is considered to be too burdensome by the flat-rate treatment (§ 19 (8)) of articles made of materials on whose supply the tax is charged;
(e) exemptions or reductions for supplies carried out by cooperative associations for associated cooperatives and by such cooperatives for associations where economic conditions and situations so require.
(3) The Minister for Finance, or the Office authorised by him, may, upon a special request from the Minister concerned, exempt supplies or services exclusively and directly from charity and education. The Regulation shall establish what is to be understood as supplies or performances exclusively and directly for charitable and educational purposes and shall determine the conditions for such exemption. If there is an applicant operating his business in the territory of Slovakia only, the post of Minister of Finance or of the Office authorised by him or the Office authorised by him to do so, which may authorise the exemption in agreement with the delegates involved.
II. Tax Entities.
Who pays the tax?
(1) The tax shall be payable:
1. a domestic entrepreneur (paragraph 2) from taxable domestic supplies and performance by him and from his own consumption. Where a domestic entrepreneur is resident or established abroad, all taxable supplies and performances carried out by him shall be deemed to have been carried out by his domestic establishment;
2. foreign businessman (paragraph 3):
(a) taxable supplies and performances which they conclude or perform on temporary stay in the country;
(b) taxable performances carried out by auxiliary forces in the country;
3. for foreign entrepreneurs (paragraph 3):
(a) concludes, mediates or satisfies the taxable supply of goods which are domestic;
(b) concludes, in the name and on behalf of a foreign entrepreneur, taxable supplies of goods abroad from such supplies within the country;
4. the insolvency proceedings of the insolvency administrator;
5. the non-surrendered estate (in Slovakia, the undistributed estate) of the entrepreneur, including from taxable supplies and performances which were carried out by the deceased, but for which the State's right to tax (Paragraph 11) arose only after its death, but before the surrender (in Slovakia) of the estate. The non-surrendered (not distributed) estate is also a taxable entity, which is attributable to the outstanding claims or parts thereof which, by the surrender (in Slovakia, by division) of the estate is transferred to the heirs of the entrepreneur (§ 11, paragraph 5, second sentence);
6. on taxable deliveries from auctions:
(a) the non-judicial entrepreneur who carries out the auction;
(b) the judicial entrepreneur proposing the auction;
7. in the case of taxable supplies of rights (§ 2 (1), (2), (2), first sentence), the entrepreneur who carries out the supply. However, on the supply of rights by a foreign entrepreneur, the transferee is obliged to pay the tax;
8. In the case of a taxable acceptance of an undertaking, to allow or suffer, to do or to renounce (§ 2, par. 1, par. 2, second sentence) an entrepreneur who undertakes. But if a foreign businessman commits, he shall be liable to pay the tax to whom he commits;
9. On import, the customs debt payer (§ 8 (2) of the Customs Act);
10. other persons by which a flat-rate regulation or decree (§ 19 (8)) imposes a flat-rate obligation.
(2) An entrepreneur is considered to be a domestic entrepreneur (§ 6 (1)):
1. which has its domicile or registered office in the country;
2. who has a residence or registered office abroad but has an establishment in the country.
(3) An entrepreneur (§ 6 (1)) who does not reside in the country of residence or registered office or establishment is considered to be a foreign entrepreneur.
Businessman, enterprise, race.
(1) An entrepreneur under this law shall be any person who carries out a separate permanent or occasional gainful activity of any kind; In particular, persons insured under the Pension Insurance Act for Private Employees in Higher Services shall not be considered as entrepreneurs, in particular in respect of activities which are the basis for this insurance obligation. The persons referred to in § 5 (1), (3) and (10) shall also be regarded as entrepreneurs. The fact that the association or other association limits performance or supply to the member does not deprive it of the nature of the entrepreneur. Intent to make a profit is not a condition.
(2) In the case of legal persons and associations of legal or physical persons, it is always assumed that their gainful activity is permanent or occasional. Legal persons shall continue to be understood as also nationalised or national undertakings and other departments having the status of legal persons.
(3) The exercise of public authority is not a gainful activity. The regulation shall determine what the exercise of public authority is.
(4) A section of an undertaking which is technically (closed-down) a single total whose activity is also the subject of separate undertakings and whose result is the subject of the market shall be regarded as a plant.
Tax exempt entities.
The following shall be exempt:
1. the State as regards postal, telecommunications and transport undertakings as regards the compulsory performance of the service;
2. Railways (§ 1 of the Act of 20 May 1937, No. 86 Coll., on Railways) in terms of performance, which depends on transport on them, and sailing undertakings in terms of performance on international waterways;
3. agents in the performance of the proceedings, unless the sum of the remuneration does not exceed CZK 80,000 in the last preceding calendar year;
4. writers, scientists and artists in the supply and performance sector, which are the direct result of writing, scientific or artistic activity, do not exceed the sum of the remuneration for them in the last preceding calendar year of 80.000 Kcs. Who is considered to be a writer, a scientist and an artist shall be established by a regulation;
5. national administrators in the performance of national administration or other assets, unless the sum of the remuneration for them does not exceed 80,000 CZK in the last preceding calendar year.
Guarantee.
(1) By its full name:
1. the acquirer of an undertaking or establishment, acquired in whole or in part, whether in full or not, for a tax which its predecessors are obliged to pay for the tax period in which the transfer of the undertaking or establishment took place and for the immediately preceding tax period;
2. personally liable shareholders for the tax which the company is obliged to pay for the period during which they were members of the company;
3. persons responsible for the administration of legal persons, for the tax which a legal person is obliged to pay for the period during which they were responsible for its administration. However, the liability may not be exercised after a period of five years from the date on which the person responsible for the administration of the legal person was released from liability for the period covered by the liability;
4. participants in occasional associations for a tax which the occasional association is obliged to pay for the period during which they participated;
5. a person entrusted with the management of a domestic establishment by a domestic entrepreneur residing or having his head office abroad (§ 5, par. 2, no. 2) for a tax which such an entrepreneur is obliged to pay for the period during which the person concerned has been entrusted with the management of his domestic establishment;
6. a foreign entrepreneur (§ 5 (3)) for a tax which, pursuant to § 5 (1), (3), is obliged to pay for him who has concluded or brokered or has complied with taxable supplies of goods in the domestic territory, or who has concluded, on his behalf and on his behalf, supplies of goods abroad;
7. the person for whom he has carried out the supply or performance of the previous order by the foreign entrepreneur (§ 5 (3)), for the tax which the foreign entrepreneur is obliged to pay on the supply or performance for him;
8. One at the initiative of which an out-of-court auction takes place for the supply tax on such an auction, unless it is itself a tax entity;
9. He who has been assigned a claim for taxable supply or taxable exercise for a tax which he is obliged to pay for such supply or exercise by a domestic entrepreneur (§ 5 (2)) who has carried out the said supply or exercise. However, the guarantee may be applied only up to the amount of the tax which is attributable to the value of the claim paid to the person to whom the claim has been transferred;
10. He who manages the uncommitted estate (in Slovakia, the undivided estate), for a tax which the uncommitted estate is liable to pay for the period during which it was administered or was entitled to manage;
11. the national tax administrator, which the undertaking's entrepreneur is obliged to pay for the period during which the national administrator was responsible for the national administration of the undertaking.
(2) In the absence of articles which serve the operation of an undertaking, an entrepreneur, but not one of its family members, or a person substantially involved in an undertaking, the owner of such articles is liable for the supply and performance tax paid by the entrepreneur on the operation of the undertaking. The government shall determine who is a family member of an entrepreneur and who is a person substantially involved in an undertaking with a participant. If a silent partner places his contribution in cash in the undertaking, he shall be liable accordingly to the amount of his contribution.
(3) The liability applies to the tax and its accessories (5% of the tax increase pursuant to § 20 (6), the late payment fee and the reimbursement of the costs of reminders and executions), which the taxpayer did not pay, although it was recalled. The tax for the period referred to in paragraph 1, Nos 1 to 5, No 10 and No 11 applicable to the scope of the guarantee shall mean the tax to which the State was entitled at the relevant time (§ 11). If personal liability affects more than one person, it guarantees all together and severally.
(4) Fysical and legal persons (in Slovakia also composesorates and urbariates), including the estate (in Slovakia not distributed), are liable for unpaid fines and criminal proceedings imposed on their legal or authorised representatives for tax offences (§ 25) committed in the course of carrying out the duties of that representative. The liability shall be exempt from physical persons who are not natural persons with regard to their legal or officially established representatives and persons who prove that their agent, in whose choice they have taken compulsory care, acted without their authorization.
(5) The loss of tax debt also ceases to be a liability.
(6) The liability for turnover tax on imports (Section 1, paragraph 1, No 3) is governed by the provisions on liability for a customs claim.
III. Tax base. Tax rates.
The tax base for taxable supplies, performance, own consumption and import.
(1) The tax base is the remuneration for taxable supply or for taxable output. All that the acquirer spends in order to obtain supply or performance shall be repaid. The payment is therefore also due for packing and packaging, parts of the acquisition price payable on taxes, fees or levies, unless they are interim items (paragraph 3), and if the purchase price has been stalled, interest included in the purchase price. The payment or part thereof shall also be provided to the entrepreneur for supply or performance by someone other than the acquirer. If a deduction is allowed, the tax base is actually paid. Imports shall be subject to tax on the remuneration and, where applicable, on the general price of the imported goods; the payment or price is added to the customs duty, the transport costs to the border, as well as taxes (excluding turnover tax) and levies levied on imported goods. What is understood by the general price under this law lays down a regulation.
(2) The costs of sending and insurance services, which the supplier or those who carry out the execution, may be excluded from the tax base, which the supplier or those who carry out the execution has proven to have paid to third parties for the recipient of the supply or performance, or which are paid by the recipient of the supply or performance, and which the supplier or those who carry out the execution shall deduct from the payment. Shippers and warehouse owners may exclude customs duties, taxes and levies which they have paid to the State in the course of the customs procedure from payment for their execution, provided that they are charged separately to the Commission. The cost of packaging can only be excluded if the supplier returns the packaging at the price already agreed and the payment is reduced by the price of the packaging. Finally, the part of the tax base which constitutes a premium for the benefit of the State collected with taxes on beer, taxes on wine, must and fruit juices, taxes on cigarette paper or a levy on sparkling wine can be excluded.
(3) The amounts received and issued by the entrepreneur in the name and on behalf of another person (interim appropriations) are not to be paid.
(4) If an entrepreneur exercises both domestically and abroad for a uniform remuneration, only the part of the remuneration which he proves to be foreign is liable to tax.
(5) If the remuneration in a case (for example, in exchange) or in execution is relevant, the tax base shall be the general price of the case received or the performance received. On own consumption, the tax base shall be the general price of the article taken from the undertaking. The general price is also determined for the measurement of the flat-rate tax (§ 19 (8)) in cases where the manufacturer supplies articles for a lower remuneration than the general price in large quantities to such an entrepreneur who purchases the goods exclusively or principally and further supplies them in the unaltered state; what is understood here as unaltered status shall be laid down in the Regulation. If the payment or price of the imported article has not been given or proved, or if it has been shown, but if it appears to the customs office to be low, the decision on the assessment of the tax is the general price determined by the estimate (§ 17 (8)).
(6) Where the remuneration is agreed or the price indicated in foreign currency or in commercial coins, it shall be converted into domestic currency in the manner laid down in the Regulation.
Tax rates.
(1) The tax is 3% of the remuneration for taxable supplies and performances or prices where there is no remuneration (§ 9). For the supply of agricultural products other than flowers, for the supply of products of mill, bakery, cheese and other milk products, dried chicory and beet, for the supply of edible vegetable fats, artificial edible fats, meat and meat products other than fish of foreign origin and game, the tax shall be 1% of the remuneration or price. A more detailed provision on what is understood by these items shall be made by the Government by a regulation. The same tax rates apply also to own consumption and to imports.
(2) Entrepreneurs who have three or more sales (paragraph 3), as well as entrepreneurs who have one or more sales with uniform prices (paragraph 4), are obliged to pay a premium of 3% of the regular turnover tax on those supplies and services that have been (met) by retail outlets in respect of single-price sales or sales. This premium amounts to 2% of the tax base (Section 9); constitute a single unit with 3% of the regular turnover tax (i.e. 5% turnover tax).
(3) The seller referred to in paragraph 2 shall mean any establishment which carries out (meets) deliveries or services exclusively or mainly to consumers; the consumer is any person who acquires an article for a purpose other than the sale or processing of an article after the business or, if it is for exercise, that acquires performance for a purpose other than his business. A manufacturing establishment, i.e. an establishment where production as a whole is carried out as a principal activity, sales offices, representative offices, sample offices and other establishments which enter into transactions on behalf of the manufacturing establishment and which then supplies and accounts the goods, shall not be regarded as a sales office. Construction sites, plants dealing with motor vehicle services (auto-service), stations for the supply of gas to motor vehicles, as well as clearing and collection points for electrical undertakings, gas stations and heating plants, petrol pumps and gas oil pumps are also not considered as a sale. The nature of the store does not lose the establishment in which the production or repair of the goods is carried out as a secondary activity.
(4) A sale with uniform prices as referred to in paragraph 2 shall mean any establishment which carries out (fulfils) exclusively or principally the supply to consumers of articles which do not belong together according to commercial practice, exclusively or mainly in one or more fixed price scales; the consumer is anyone who acquires an article for a purpose other than for sale or processing after business.
(5) Paragraph 2 shall not apply to:
1. to entrepreneurs whose total turnover in the last preceding calendar year did not exceed CZK 1,000,000. The regulation shall establish what is understood as a total turnover;
2. to the profitable and economic communities (cooperatives), without regard to the amount of total turnover.
(6) The Minister of Finance, in agreement with the Ministers of Industry and Internal Trade or the Minister of Agriculture or the Minister of Nutrition, in Slovakia, in agreement with the Minister of Industry and Trade or the Minister of Agriculture and Land Reform or the Minister of Food and Supply, may, in cases of special concern, grant exemption from or reduction of the premium referred to in paragraph 2.
(7) The flat-rate regulation (Paragraph 19 (8)) may provide that undertakings referred to in paragraph 2 are to pay a flat-rate turnover tax premium which replaces only or mostly 3% of the regular turnover tax up to 20% of the flat-rate tax.
(8) Where imports are subject to tax (Paragraph 1 (1) (3)), an appropriate fixed rate, by piece, measure or weight, may be levied instead of the percentage rate. the relevant rate shall be established by the Government by a regulation. The Government may also impose an increased rate on imports of certain items in order to equal the tax burden on imports of goods produced domestically. Furthermore, the Government may, by regulation, impose a higher tax rate on imports or supplies of goods from a Member State than that referred to in paragraph 1, where that State places a burden on imports or supplies of domestic goods at higher rates than those of its own origin.
(9) The part of the remuneration on the packaging and packaging is subject to the same tax rate as the article supplied or imported.
(10) Where items whose supplies are subject to different tax rates are supplied in return for a uniform remuneration, the highest rate shall be to measure the tax on the uniform remuneration. In agreement with the relevant central interest organisation for the sector in which the use of uniform remuneration for such supplies is customary, the Minister for Finance, in Slovakia, may determine the ratio to which it is to divide uniform remuneration according to the relevant tax rates.
IV. Origin of tax liability.
The State's tax claim.
Transfer tax.
The creation of tax liability. The State's tax claim.
(1) The tax obligation is normally incurred by the supply or performance. However, the State's right to tax may be exercised in principle at the time of payment, even if the payment is made before delivery or execution. Exemptions from these provisions are contained in other paragraphs. Payment means any performance, thus not only payment by cash, but also credit, exchange, cheque, debt receipt, debt management and the like.
(2) The tax obligation arises and the State's right to tax may be exercised:
(a) on own consumption (§ 1 (1), (2)) at the time when the article was taken from the holding;
(b) on deliveries from auctions at the time of the payment;
(c) where the taxpayer was permitted to tax the prices charged in the tax period instead of the payment received (§ 17 (7)), at the time when the account was issued, but if the payment for delivery or execution was paid in whole or in part before, at the time of payment;
(d) in the case of supplies and transactions concluded or carried out by foreign entrepreneurs (§ 5 (3)) at the time when the supply was closed or executed;
(e) in the case of deliveries which have been facilitated, fulfilled or closed by persons referred to in Article 5 (1), (3), at the time when the supply was made, fulfilled or closed;
(f) on importation (§ 1, par. 1, par. 3) at the time when the obligation to pay the customs claim arises (§ 85 of the Customs Act).
(3) If the payment in a currency or a cheque is relevant, the tax shall be payable by delivery or enforcement and the State's right to tax may be exercised at a time when the supplier or the person who performed the exercise receives the value of the bill or cheque paid, even if it is before their maturity.
(4) If a domestic entrepreneur (§ 5 (2)) authorises payment of the payment in instalments and also reserves ownership of the case until the full payment of the payment, the tax shall be payable by surrender to the transferee and the State's right to tax on individual instalments may be exercised at the time of payment.
(5) Where a domestic entrepreneur (§ 5 (2)) transfers a claim for a taxable supply or a taxable exercise carried out by him, a claim to the State may be claimed at the time the claim was transferred for a tax that is still outstanding or part of the claim. The same applies mutatis mutandis to transfers of claims arising from the national administration of an undertaking, the administration of bankruptcy, the management of the estate (in Slovakia not distributed) or the surrender (in Slovakia by division) of the estate to the heirs.
(6) The provisions of paragraphs 3, 4 and 5 do not apply to an entrepreneur authorised to tax the prices charged (Paragraph 17 (7)).
Transfer tax.
(1) The entrepreneur is not entitled to charge the turnover tax wholly or partly separately or otherwise wholly or partially separately in addition to the payment.
(2) The following exceptions are permitted from the provisions of paragraph 1:
(a) The entrepreneur may charge the turnover tax which he is obliged to pay on supply or performance, either separately or separately, in addition to the remuneration, if the remuneration is governed by the rates which have been laid down by law, by a government regulation, by measures of the highest agency of the price or by measures of the food and supply agent expressly excluding turnover tax.
(b) The entrepreneur shall be entitled to separately charge the tax or tax difference if the cases referred to in paragraphs 36, 12, 2 and 14 are concerned.
(c) The entrepreneur is obliged to charge a flat-rate fee separately if he is required to do so by the flat-rate regulation (§ 19 (8)).
(3) In the cases referred to in the second sentence of Article 5 (1), (7) and (8), the second sentence of Article 5 (1) and (5) (1), the person liable to pay the tax is entitled to deduct the tax.
(4) A flat-rate order or decree may provide that the persons liable to pay the flat-rate payment are entitled to claim compensation for the flat-rate payment from persons carrying out supplies or transactions on which the turnover tax is covered by the flat-rate payment.
V. Inadmissibility of self-governing surpluses.
The turnover tax may not be subject to the increases in autonomous volumes.
VI. Measurement and collection of tax.
Reporting duty.
(1) A local entrepreneur (§ 5 (2)) is obliged to declare the establishment of an undertaking, establishment and permanent establishment, as well as the transfer, cessation, cancellation or resettlement of an undertaking, establishment or permanent establishment to the administration in whose territory the undertaking, establishment or permanent establishment is situated (in the case of resettlement, both of which the undertaking, establishment or permanent establishment is located and of which the administration is located).
(2) Where the jurisdiction of the Office for the assessment of the tax is governed by the place of residence of the entrepreneur, the latter shall declare the establishment of the place of residence to the tax administration in whose territory he resides; the change of residence must be notified by such an entrepreneur to both the tax administration in which he was last resident and the tax administration in which he is new resident. In the notices referred to in paragraph 1, the entrepreneur shall also indicate his residence.
(3) The notification period referred to in paragraphs 1 and 2 shall be 15 days. It shall begin on the day following the establishment, demise or resettlement of the undertaking, establishment or permanent establishment, after the creation or change of residence.
(4) The foreign entrepreneur (§ 5 (3)) is obliged to report his activity to any tax administration in whose territory he intends to operate before it begins; a foreign entrepreneur who carries out domestic performance by auxiliary forces shall be required to appoint an agent in the declaration who has his permanent residence or registered office in the country. Also, for whom a foreign entrepreneur carries out a supply or performance on a previous order, he is obliged to report it to the tax administration, in whose district the foreign entrepreneur will operate this activity, even before it begins.
(5) The persons referred to in § 5 (1), (3) are also required to report their activities to the tax administration of the foreign entrepreneur in whose territory the activity will be operated prior to its commencement.
Payback base. Measurement basis. Tax period.
(1) This law recognises:
(a) the tax base (§ 9), i.e. the tax base which is attributable to an individual supply, individual performance or individual case of own consumption or import;
(b) the repayment basis (paragraph 2), i.e. the tax base for the repayment period (Paragraph 20 (1) and (2));
(c) the assessment basis (paragraph 3), i.e. the tax base for the tax period (paragraph 4).
(2) The basis of payment is a summary of the tax bases (Section 9) of the taxable supply, output and own consumption for which the State's tax entitlement (Section 11) arose during the repayment period (Sections 20 (1) and (2)), after deduction of the withholding appropriations. The basis for payment is therefore the sum of the remuneration received by the entrepreneur in the repayment period for taxable supplies and services (gross sales), plus the sum of the general prices in the cases of § 9, paragraph 5 and minus the deduction of the withholding items. In the cases of Sections 5, 1, 7 and 8, the remuneration paid to the foreign entrepreneur shall take place. Reductions continue to be understood here as remuneration (general prices) for supplies, performance and own consumption exempted (Sections 4 and 7) or covered by a flat-rate (§ 19 (8)), amounts deductible from the tax base (§ 9 (2)), refunded payments (§ 18) and amounts deductible from the tax base (§ 17) (7) for a taxpayer authorised to tax the prices charged. Where an entrepreneur has two or more undertakings, establishments or establishments, the repayment bases of all undertakings, establishments or establishments shall be added. However, if it is an entrepreneur operating a business activity throughout the national territory, the payment bases of enterprises, plants or establishments located in the Czech and Moravian-Silesian countries (or only in one of these countries) and the payment bases of enterprises, establishments or establishments located in Slovakia will be added separately.
(3) The assessment basis is the sum of the repayment bases (paragraph 2) for the tax period (paragraph 4).
(4) The tax period is a calendar year. If an entrepreneur who has started or permanently and completely ceased business in a calendar year has accepted payments only in part of a calendar year, the tax period shall be that part of a calendar year. In the supply and performance of foreign entrepreneurs (§ 5 (3)), the tax period shall be a calendar month or shorter period, if their domestic activities do not last the whole calendar month.
(5) Imports shall be subject to the assessment and payment of turnover tax in each individual case as part of a customs claim.
Tax control.
(1) The tax authorities are entitled to enter into business premises and business rooms in working hours and to view records the mandatory management, form and content of which may be determined by the Government by a flat-rate regulation (§ 19 (8) or by another regulation, and by its commercial letters, books, records or other commercial documents relating to the undertaking. The entrepreneur shall keep all such documents for a period of six years and submit them to the tax authorities or authorities at any time for inspection; that period shall be calculated from the end of the calendar year in which the last entry in the books and records was made or in which the commercial documents or documents of the entries were produced.
(2) Only the domestic warehouse of goods from which deliveries are made in the domestic territory shall also be regarded as an establishment, regardless of whether the warehouse belongs to domestic or foreign persons.
(3) Entrepreneurs or their representatives shall also be obliged to provide the financial authorities with all the explanations necessary to assess the tax and to implement this law.
(4) The Revision Service of the Financial Administration shall also apply to the control of turnover tax within the limits of the provisions applicable to it.
(5) Entrepreneurs who maintain or are obliged to carry out business books shall in any case be obliged to issue their customers a proper account in excess of the payment of CZK 2,000. In the account, the date of delivery or performance, the name (company) and address of the acquirer and the type and price of the goods must be indicated. Account must be entered in trade books or records or a copy of the account must be kept.
Tax returns.
(1) By 14 February each year, the taxpayer is required to submit a tax return to the competent tax administration for the last year, containing the information needed to establish the assessment basis for the tax period (Sections 15 (3) and (4)), broken down by period of payment (Sections 20 (1)). The admission formula shall be issued by the Ministry of Finance. The taxpayer is obliged to fill out all the sections of the confession, to attach the required documents and to sign the confession at the same time, claiming that he has done all the data to his best knowledge and conscience.
(2) If, in the tax period, a permanent and complete cessation of business is made, the current entrepreneur is obliged to submit a tax return within 30 days of the permanent and complete cessation of business. In the case of a payment received later, the said entrepreneur shall continue to have the status of tax payer.
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Regulation Information
| Citation | Act No. 31 / 1946 Coll., on turnover tax |
|---|---|
| Regulation Type | - |
| Author | - |
| Collection | Code of Laws |
| Date of Promulgation | 28.02.1946 |
|---|---|
| Effective from | 01.03.1946 |
| Effective until | - |
| Status | Valid |
The regulation text is for informational purposes only.
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