Taxes
14 December 2018

Parliament approved the Act on special levy of supermarket chains after President´s veto

Yesterday (December 13, 2018), the Slovak Parliament overrode President’s veto on the Act on special levy of supermarket chains which introduces the obligation to pay a special levy in the amount of 2,5% of the net turnover of the supermarket chain.

Marianna Dávidová
Mária Gašparová

According to the approved wording the levy base should be the net turnover as defined by the Slovak Act on Accounting, i.e. revenues from sale of products, goods and services less the discounts. The levy rate was set at 2,5% and the levy should be calculated as the levy base multiplied by the levy rate.

The supermarket chain should be obliged to deliver the written notice on the amount of the levy to the Levy Administrator in the prescribed form by the end of the calendar month following the levy period and within that period the levy should be also payable.

According to the draft of the Act if the amount of the levy does not exceed EUR 5,000 the supermarket chain is not obliged to pay the levy.

The levy period for which the supermarket chain should be obliged to pay the levy should be the three consecutive calendar months of the relevant accounting period. The draft of the Act states also the first and the last levy period of the supermarket chain for the relevant accounting period.

The approved draft of the Act further provides the definition of the supermarket chain as the group of business establishments that use the same or mutually interchangeable business name and which are operated by the same entrepreneur or by related entrepreneurs, with the following conditions:

  • The supermarket chain is a provider in the food industry;

  • The supermarket chain operates in at least 15% of all districts;

  • At least 25% of net turnover comes from the sale of food;

  • There is unified design, shared communication and joint marketing activities of the operations.

On the contrary, the definition of the supermarket chain excludes inter alia small and medium-sized entrepreneurs, the chains that are food producers or are related to the food producer, with 80% of the net turnover deriving from the sale of produced foods and the supermarket chains with at least 80% of turnover deriving from the sale of food of one class.

The special levy of supermarket chains will be considered as tax deductible expense upon its actual payment.

Moreover, the approved wording also regulates the way of payment of the levy, competence of the levy administrator and the lability for breach of obligations under the law.

Under the common, transitional and final provisions the supermarket chain should be required to pay the levy as of the first levy period falling into the accounting period starting after 31 December 2018.

The entry into force of this Act is expected on 1 January 2019. We will keep you informed about the next steps.

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