Tax system in the Czech Republic
Here you can find general information on the most important tax types in the Czech Republic.
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The current tax system in the Czech Republic was introduced in January 1993 and has been reformed since 01.01.2008 (the last modification was introduced through the “tax packet” on 01.01.2013) The system currently includes the following tax types:
- Direct taxes: income tax, property tax, road tax, inheritance tax, gift tax, real estate transfer tax
- Indirect taxes: value-added tax, excise tax
1. Income tax
The income tax must be paid by all natural and legal persons from their income, further detailed information can be found here.
2. Value added tax (VAT)
All companies with a turnover of more than CZK 1,000,000 (approx. EUR 40,000) in the last 12 months are subject to VAT. More detailed information can be found here.
3. Road tax
Road tax is levied on vehicles used for commercial or similar activities in the Czech Republic. Different tax rates apply to passenger cars and trucks, which are based on the total weight of the vehicle and cubature for passenger cars and on the total weight and number of axles for trucks over 3.5 tons.
4. Real estate tax
The real estate tax consists of the property tax and the building tax. The tax rates depend on the area of the property and the way in which it is used. Different tax rates apply in different towns and cities. Basically, the highest tax rates apply in the largest cities.
5. Real estate acquisition tax
The rate of this tax is 4% of the basic tax amount, which is usually equal to the purchase price of the property. In September 2020 this tax was retroactivelly cancelled from 31st March 2020.
6. Excise tax
The excise tax is compulsory for methylated spirit and spirits, wine, beer, tobacco as well as tobacco products and hydrocarbon fuels.
Publication date 27.10.2019 Last updated date: 26.2.2021