Posted by on 8 Mar 2011. Filed under Current Affairs, Top news. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

Miklos: tax reform will affect sole traders the most

Finance minister Ivan Miklos gave a press briefing today regarding the planned tax and levies reform, admitting that it disadvantages sole traders and part-timers over full-time employees.

Finance minister Ivan Miklos (c) The Daily

Miklos justified the need for the new system by saying that the current system was deformed and unfair. To date anyone working on a part-time work agreement or a sole trader’s license had the upper hand, thanks mainly to the flat-rate expenses system.

With the reform the government aims to simplify the whole system and cut down bureaucracy, while making it also fairer than it is at present. As partial compensation for higher payments for the 230,000 or so sole traders, the government is pondering with the idea of granting them a tax bonus or adjusting the depreciation of fixed assets for them.

The reform will start to adopt its final shape over the next few weeks, but any reform to the tax and levies system will require the intervention to something like 160 legal norms, for example.

The new system sets the reference and tax bases higher for sole traders, and so their net incomes will drop. Those who earn a net annual profit of up to EUR 8,162 will suffer an 8.4% drop in income on average, according to webnoviny.sk, while those with a profit up to EUR 84,706 will be 11.2% on average worse off after the reform.

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