At present, a draft amendment to the Tax Administration Act is currently in the interservice commenting procedure (Tax Procedure Code) as amended (hereinafter referred to as the “Tax Procedure Code”) and aims to introduce a number of changes; the most important ones are mentioned below:
- Entities involved in tax administration – for reasons of legal certainty, a legislative text of the definition of a taxable person is specified in such a way so as to consider an organisational unit of an association – acting on its own behalf and being, therefore, a taxable person (Decision of the Supreme Court of the Slovak Republic, Case No. 3 Cdo 146/96) – to be a legal person;
- Use of languages in tax administration – for reasons of reducing administrative burdens, it is proposed that a tax authority may refrain from requiring a certified translation of documents submitted by a taxable person;
- Authority to act on one’s behalf – in the event a taxable person submits a power of attorney and subsequently submits another power of attorney, where the scope of the two powers overlaps, it is proposed that the new power of attorney replaces the existing one to the extent of their overlap. If a tax authority has doubts concerning the submitted power of attorney, the tax authority shall request a statement from the taxable person, and propose that the representative perform only necessary actions until the shortcomings are addressed in order for the representative not to perform an unrepeatable act. If a taxable person does not respond to such a request and does not remove the doubts, the tax authority shall consult the taxable person or a representative acting on the basis of a power of attorney, which the tax authority has no doubts about;
- Method of submission – it is proposed that in the event taxable persons – who are obliged to communicate by electronic means with the financial administration – deliver submissions with a prescribed structure by means other than via electronic submission at the Financial Administration Portal (g. in writing or through the Central Public Administration Portal ÚPVS), these persons shall be requested to deliver such submission in a proper way. Only if the taxable person fails to comply with such a request will such submission be deemed not to have been submitted;
- Tax Return – given the fact that the tax authority determines the tax by auxiliary calculations only when the taxable person fails to submit the tax return even after being delivered the request to do so by the tax authority, it is proposed to unambiguously establish that the taxable person may not submit the tax return for the tax year, for which the tax was determined by auxiliary calculations;
- Production of evidence – within the scope of providing evidence, it is proposed to establish that the taxable person shall prove the facts he/she was requested to prove in tax administration, not only in course of the tax audit or tax proceedings;
- Delivery by electronic means – it is proposed to clarify the provision concerning electronic delivery of documents in order to ensure the tax authority delivers documents by electronic means to the person who has access to electronic services, i.e. to the person, who is obliged to communicate with the authority by electronic means, or to the person who submitted a request to communicate by electronic means, as well as to the person who had no obligation to communicate by electronic means but has voluntarily registered on and was authorised by the Financial Administration Portal;
- Tax audit – it is proposed to remove indication of the reason for the commencement of the tax audit from the minutes on the commencement of the tax audit in order not to defeat its purpose in the event the audit is carried out on the initiative of a law enforcement authority. At the same time, it is established that the performed tax audit may be extended not only to another tax and tax year but also to an audit of another regulation, e.g. the Accounting Act; it is proposed to amend the provision on the delivery of protocol so that in the event the tax audit reveals a difference from the submitted tax return – where the protocol is delivered together with the request, – the request is part of the protocol;
- Procedure for determining the tax by auxiliary calculations – for reasons of legal certainty, it is proposed that the starting date for the determination of the tax by auxiliary means be the day following the date of delivery of the notice;
- Method of payment of tax – for reasons of efficiency, it is proposed that the tax authority send the notice of transfer of the payment only when the sum exceeds EUR 5. At the same time, it is proposed to refrain from sending notices when overpayment that is lower than EUR 5 is used;
- Tax deferral and payment by instalments – it is proposed that the decision granting the tax deferral and tax payment by instalments be repealed by law, i.e. without the decision of the tax authority in the event the decision by which the tax was assessed is revoked, e.g. by extraordinary remedies or court decisions, that is, if the original decision is revoked. In order to make this institute more appealing, it is proposed to shorten the period during which the tax deferral or tax payment by instalments is not permitted because the taxable person did not comply with the conditions laid down in the decision of the tax authority, i.e. shorten the period from five years to two years;
- Void decision – for reasons of legal certainty, it is proposed that a decision issued after the termination of the right to assess the tax shall also be considered void;
- Registration procedure – in the provision on the registration procedure it is proposed that the obligation of natural and legal persons to disclose the account numbers held with payment service providers is removed, seeing as such information is provided to the tax authority by the relevant providers;
- Tax assessment procedure – it is proposed to specify the provisions concerning the decision in the tax assessment procedure, which requires to issue a decision no later than three months from the period determined by the tax authority in the request to respond to the protocol. At the same time, it is proposed to establish that in the event the decision is repealed and the case is referred back by the appeal body for further proceedings, the same procedure is followed as in the tax assessment procedure carried out after the receipt of the protocol;
- Procedure of lodging an appeal by the first-instance bodies – due to the possibility of the taxable person to supplement his appeal until the period for lodging an appeal has expired, it is proposed that the period for referring the appeal to the second-instance body commence after the period for lodging an appeal has expired, and in case the tax authority requests the taxable person to supplement the appeal, the period for the referral of the appeal shall commence only when the taxable person supplements the appeal at the request of the tax authority;
- Tax overpayments and interest – a provision is proposed concerning tax overpayments, whereby the tax authority returns the overpayment to the account specified in the application by the taxable person. In the event the taxable person did not include the account number in the application, the tax authority shall return the overpayment to the account notified by the taxable person or a payment institution. In the event the tax authority does not have any record of the taxable person’s account number, the tax authority shall return the overpayment via a postal money order to the taxable person’s address, provided that the overpayment does not exceed EUR 15,000, i.e. the maximum amount that can be sent via a postal money order;
- Right of lien – it is proposed to amend the provision of the right of lien in order to unambiguously determine the moment the right of lien of the tax authority commences, i.e. when it becomes enforceable. It is proposed that the tax authority deliver the decision on the establishment of the right of lien to the debtor and to the cadastre or another register, i.e. the tax authority does not need to wait for the delivery to the debtor;
- Limitation and expiry of the right to recover tax arrears – it is proposed to amend the limitation period for the recovery of tax arrears following the period referred to in § 166 f of the Bankruptcy and Restructuring Act, according to which, upon cancellation of depth relief, the unsatisfied claims shall be fully restored to their original enforceability and due date. Such claims shall not be time-barred until at least ten years have passed since the cancellation of depth relief;
- Execution – it is proposed to provide that in the event where a taxable person or another entity initiates court proceedings in order to exclude property from tax execution, the tax authority shall postpone the tax execution regarding the property in question until the court has reached its final decision;
- it is proposed to communicate with the bank by electronic means in the event the execution is extended to another bank account, thus making the entire decision-making process more effective;
- it is proposed to expand the reasons for postponing tax execution; in the event the tax debtor or another person brings an action before the court in order to exclude property from tax execution;
- it is proposed to introduce a new type of tax execution – tax execution by withholding a driver’s license. In the event of this type of tax execution, the taxable person is indirectly compelled to fulfil his/her obligation in order to have the driver’s licence returned. The execution shall not apply to non-payers who are professional drivers.
- where the movable property is sold as part of the execution process, it is proposed to specify precisely the motor vehicle’s time of arrival in order not to obstruct the execution process, e.g. by the taxpayer arriving with the vehicle on a specified day, but in the evening hours;
- for reasons of legal certainty, it is proposed that the tax debtor’s time period for paying the enforcement costs shall commence on the date of the delivery of the tax authority’s decision;
- Penalties – it is proposed to reduce the lower limit of the penalty in the events where the taxable person does not fulfil his/her obligation imposed by the tax authority’s decision, and in the events where the taxable person does not fulfil one of the non-monetary obligations;
- a method of calculating the penalty is provided, where the tax has been assessed by an assessment order;
- it is proposed to provide that a penalty shall not be assessed in the event where the taxable person submits a supplementary tax return, which reduces the claimed tax refund or brought claim according to a separate regulation against the claim included in the “proper” tax return, and such tax or claim has not yet been refunded.
