The National Assembly adopted at second reading amendments to the Corporate Income Tax Act and the Value Added Tax Act

The National Assembly adopted at second reading amendments to the Corporate Income Tax Act and the Value Added Tax Act.

The amendments to the Corporate Income Tax Act introduce the rules of a European directive and equate certain hybrid entities incorporated or established in the country, which have hitherto been outside the scope of taxable persons in the current law, with taxable persons under certain conditions. These texts shall enter into force on 1 January 2022.

The National Assembly, which adopted at second reading amendments to the Value Added Tax Act, decided that food vouchers should be subject to value added tax. The amendments remove the exclusion from the scope of the law of vouchers for a specific purpose and multi-purpose vouchers. The European Commission, in its opinion, found this exclusion to be incompatible with the requirements of the Value Added Tax Directive. According to the adopted provisions, vouchers issued after 31 December 2021 will be subject to VAT.

The texts adopted provide for exemptions from VAT for supplies of goods or services intended either for the use of the armed forces of a Member State of the European Union or of accompanying civilian personnel, or for the supply of their dining rooms or canteens, where those forces engage in defence activities aimed at carrying out a Union activity.

In order to address the effects of the COVID-19 pandemic, it is proposed that the reduced rate of nine percent for some goods and services apply until the declared emergency epidemic situation on the territory of the country related to the epidemic spread of COVID-19 ceases. The adopted texts expand the range of foods suitable for babies or young children, to which a rate of 9 percent VAT applies, and include specialized milk formulas (with partially hydrolysed protein and those for children with allergies) and dietary foods for special medical purposes intended for infants.