The Ministry of Finance is preparing a proposal to amend the Commercial Code which should help to improve the tax system and effectiveness of tax collections.
The amendment is intended to be in force from 1 January 1998 and should prevent businesses from being wound-up and leaving behind unmet liabilities. This should be accomplished through the revision of the rules for foundation, winding-up and demerging of companies. The amendment should also help to solve difficulties with enforcement of receivables by banks.
Further amendments to the Commercial Code should also introduce certain limitations on cash transactions as a way to cut down tax evasion. The possibility is being considered that certain cash transfers exceeding limits should not be considered as a tax deductible expense and should not be treated as a taxable supply for input VAT recovery purposes.
The rules concerning business activities of foreign persons in the Czech Republic are also likely to be revised and made more strict.
The content of this article is intended to provide a general guide to the subject matter. It is therefore not a substitute for specialist advice.
For further information contact Paul Antrobus or Richard Fletcher, Arthur Andersen Prague, tel +42 2 2440 1300 or enter a text search 'Arthur Andersen' and 'Business Monitor'.
The amendment is intended to be in force from 1 January 1998 and should prevent businesses from being wound-up and leaving behind unmet liabilities. This should be accomplished through the revision of the rules for foundation, winding-up and demerging of companies. The amendment should also help to solve difficulties with enforcement of receivables by banks.
Further amendments to the Commercial Code should also introduce certain limitations on cash transactions as a way to cut down tax evasion. The possibility is being considered that certain cash transfers exceeding limits should not be considered as a tax deductible expense and should not be treated as a taxable supply for input VAT recovery purposes.
The rules concerning business activities of foreign persons in the Czech Republic are also likely to be revised and made more strict.
The content of this article is intended to provide a general guide to the subject matter. It is therefore not a substitute for specialist advice.
For further information contact Paul Antrobus or Richard Fletcher, Arthur Andersen Prague, tel +42 2 2440 1300 or enter a text search 'Arthur Andersen' and 'Business Monitor'.
