The draft of a law which should make changes to some regulations in the tax area starting in 2019 in connection to the implementation of the Anti Tax Avoidance Directive (ATAD) will also bring changes to the area of taxation of natural persons.

One of the most significant changes to this would be the proposed cancellation of the super-gross wage and solidarity tax. The Ministry of Finance is suggesting to implement multiple tax rates for taxation of natural persons; 19% rate and 23% rate (originally suggested at 24%) while maintaining the 15% rate for withholding tax on selected capital income.

More specifically, concerning income from employment, instead of calculating tax from the super-gross wage applying the 15% tax rate (plus solidarity tax where applicable) they are suggesting tax to be calculated from gross wage applying one of the rates based on income within two categories: up to CZK 1 500 000 using 19% rate, and more than CZK 1 500 000 using 23% rate.

The draft is going through the reflection process at the moment. We will keep you updated about any further developments.