Draft amendment to the Slovak VAT Act

Major proposed changes are:

• Changes in VAT exemption of the supply and rent of immovable property

• Carrying out of construction works in the amount of at least 40 % of the value of the building before their start would be treated as “new” first occupation.

• Supplier of immovable property or its part fulfilling the conditions for VAT exemption will not be entitled to opt for taxation provided the subject of the supply is a flat or apartment in block of flats or the immovable property is determined for dwelling.

• Lease of a flat, family house, apartment in block of flats or its parts will be VAT exempt with no option for its taxation.

• New obligation to adjust the amount of input VAT deducted with respect to purchase of movable tangible property with the acquisition value at least EUR 3,319.39 which is used for business as well as other than business purpose depending on the change of the extent of their use.

• Implementation of EU legislation with respect to vouchers and place of supply of telecommunication, broadcasting and electronically supplied services provided to non-taxable persons.

• “Domestic” reverse-charge upon supply of particular kind of agricultural crops and metals will not apply should the seller issue a simplified invoice, except for corrective invoices.

Other proposed changes include i.a.:

• New definition of the term “ turnover”,

• Cancellation of tax collateral upon VAT registration,

• Changes in VAT refund for travellers upon export of the goods.

We will keep you informed on the next steps within the legislative process.