The Ministry of Finance of the Slovak Republic published a draft of the future amendment to Act No. 222/2004 Sb. on value added tax, as amended (hereinafter referred to as the “VAT Act” or “amendment”). The subject of this draft amendment is, among others:

• The change in § 53b introduces the customer’s obligation to correct the deducted VAT on purchased goods or services to which VAT has been added, unless the customer has settled this obligation in whole or in part within 100 days from its due date. This means that if the Customer fails to pay for the purchased goods or services within 100 days, the Customer is obliged to correct the deducted VAT in terms of the unpaid liability in the settlement period in which 100 days have elapsed from its due date. It is expected that the introduction of such an obligation will increase the incentive of customers to pay overdue receivables, as failure to pay will result in the obligation to adjust the deducted tax.

• Exemption from the obligation to register as a VAT payer after exceeding the turnover of EUR 49,790, if the taxable person supplies only goods or services exempt from VAT. The main objective of such a change is to reduce the administrative burden. This is the case where the taxable person carries out only exempt activities, such as the provision of financial or insurance services or the letting of real estate which is exempt; in this case, VAT registration is no longer required when the turnover from this activity exceeds EUR 49,790. However, if such an entity wishes to register voluntarily, it may do so.

• Other changes were aimed at reducing the administrative burden and eliminating some of the shortcomings of the Act that arose as a result of its application in practice. These include, for example, a more detailed explanation of what constitutes a small consignment whose importation is exempt from VAT for the purposes of the VAT Act; the statutory method of determining the amount of the adjustment to the deducted tax on theft of goods; abolition of the obligation to file a zero tax return for the first customer in triangular trade; changing the tax payment deadline when purchasing a new means of transport from another EU Member State.

• From January 1, 2024, a new one was introduced registration obligation for payment service providers through which payments for delivered goods or services are made – this change results primarily from the transposition of the EU Council Directive, the main purpose of which is to combat tax avoidance resulting from cross-border e-commerce, where the customer is located in one EU Member State and the supplier of goods or services is based in another EU Member State or in a third country, with the entire purchase being made online. The lack of customer information in such transactions leads to insufficient and inaccurate information for national tax administrations and therefore often leads to non-declaration of the tax liability. These records will then be sent by each EU Member State to the Central European payment system where they will be checked.

It is proposed that the amendment to this VAT Act will come into force from 1 January 2023, with the exception of the obligation to keep records for selected payment service providers, which will come into force from 1 January 2024.