War Tax or Exceptional Gains Tax: who is at risk?

Published:
13. September 2022
Branch:

Government parties are currently discussing the possible introduction of a special tax targeting windfall or extraordinary profits. According to the government, these gains are mainly arise for the energy sector and banks as a result of the war in Ukraine and rising inflation. The introduction of this tax on the fuel production and distribution sector is also under discussion. However, given the potential costs of implementing and collecting this tax, it is questionable whether an extraordinary tax would be profitable in the fuel sector. 

The exact parameters of this new tax are not yet available. However, three bands are likely, with rates of 40, 50 and 60 per cent after deducting the average annual profits of taxed companies over the last 5 years. It is assumed that this will be a temporary tax and, if enacted, a fixed end to its application could be included in the law. 

We will continue to monitor the situation for you. 

Author: Lukáš Pflug

Author: Lukáš Pflug