As more and more companies go bankrupt or struggle to keep above water, the Ministry of Finance is apparently planning to levy an additional tax on dividends as of next year, which could send the number of bankruptcies or closures even higher.
An article in Hospodarske Noviny discloses the plans of the ministry to introduce a 10% tax on dividends paid out to the owners or shareholders, on top of the corporate tax that the company itself has to pay on the profit.
The ministry is not commenting on the issue, saying only it is too premature, but the plan, avoided by governments to date, could send more companies down the drain or repel potential foreign investors.
The FA Hayek Foundation analysis of BnM’s legislation since coming to power puts things into perspective in more ways than one:
The figures quoted in the most recent report are only to the end of the 16th session 2012.
Laws enacted by the SMER majority govt. since taking power – 132
Laws that increased to burden on the tax payer – 46
Laws that increased the burden (tax inc.) on business – 45
Laws that eased the burden on the tax payer – 21
Laws that eased the burden (tax inc.) on business – 27
Overall effect: “A substantial rise on the burden for both tax payers and business”
Another interesting fact this article provided is that in the whole of 2012, the Slovak parliament ( Single chamber, overall single party government majority) only managed to pass 44 pieces of legislation. The UK parliament ( Two chambers, overall coalition government majority) managed to pass 4194 pieces of legislation in the same period. Work shy?, devoid of any clear plan? or the bar open far to often?
I assume this would be on top of the recent 14% health & social payment on dividends after company tax has already been payed. Socialist Fico will soon see that companies simply moving their profits offshore or otherwise leaving the country will mean no money is left for socialism! Slovakia’s loss….
If BnM and his crew want to play Russian Roulette with all six chambers loaded I’m all for it but this tinkering with the things that make Slovakia attractive to foreign business investment is irresponsible. They’ve already introduced legislation and policies that have damaged potential recovery, sent a record number of businesses to the wall and deterred job creation. This latest “idea” could be the last straw and turn the slight recovery into recession as businesses look for “greener fields”. He crowed that his party would not increase taxes yet that is all they have done, there has been scant effort in reducing the costs of state organisations, in fact with the pay rises and increases in staff, they have ballooned. A man more concerned about his own popularity and continued “rule” than making the tough decisions that are needed to improve things here should not be in office.
As if the typical folk can afford this. I thought things were to get better?
Oh that’s right we still have Bobbbbbaaaaaay in his post.
Better! No Matt the elite have to feel a bigger bulge in their trousers long before the bone gets given to the dogs.
Wonder if this will add to Benta n, J&tax free’s liabilities. Bobby wouldn’t want to upset the puppeteers . Where’s a bugged apartment when you need one 😉