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The Tax System in the Czech Republic

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  • Chiara Bronchi
  • Andrew Burns

Abstract

This paper discusses the tax system in the Czech Republic and offers some specific suggestions for reform. Viewed in international context, the Czech system is broadly similar to those operated in other OECD countries. Like them, it exhibits a number of non-neutral features, some of which reflect the economy’s command and control past and others which reflect compromises between the desire to minimise economic distortions and the need to implement a system that is administratively and politically practical. The evidence, reviewed in this paper, suggests that the main priorities for reform should include: eliminating the tax bias in favour of self-employed work forms; substantially reducing the number of goods and services subject to the reduced VAT rate; lowering social security contributions and increasing reliance on the personal income tax system. In addition, more use of property taxes, in particular real estate, might be warranted from the points of view of revenue enhancement ... Ce document examine le système fiscal de la République tchèque et formule plusieurs propositions spécifiques concernant les réformes à mettre en œuvre. Dans une optique internationale, le système de la République tchèque est assez proche de ceux des autres pays de l’OCDE. Comme eux, il présente un certain nombre de caractéristiques non neutres, dont certaines tiennent au passé communiste de l’économie et d’autres reflètent un compromis entre, d’une part, la volonté de réduire au minimum les distorsions économiques et, de l’autre, la nécessité de disposer d’un système qui soit pratique sur le plan administratif et politique. L’analyse présentée dans ce document incite à penser que les réformes devraient viser en priorité à éliminer le biais fiscal en faveur du travail indépendant, à réduire sensiblement le nombre de biens et services assujettis au taux réduit de TVA, à réduire les cotisations de sécurité sociale et à mettre davantage l’accent sur l’imposition des revenus des ...

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  • Chiara Bronchi & Andrew Burns, 2000. "The Tax System in the Czech Republic," OECD Economics Department Working Papers 245, OECD Publishing.
  • Handle: RePEc:oec:ecoaaa:245-en
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    File URL: http://dx.doi.org/10.1787/242706151678
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    Cited by:

    1. Gani Asllani, 2011. "The Impact of Fiscal Policy to the Kosovo Economical Development," Acta Universitatis Danubius. OEconomica, Danubius University of Galati, issue 1(1), pages 123-137, March.
    2. Jiøí Veèerník, 2006. "Income Taxes and Social Benefits among Czech Employees - Changes since 1989 and a Cross-national Comparison (in English)," Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, vol. 56(1-2), pages 2-17, January.
    3. Kamil Galuscak & Jan Pavel, 2007. "Unemployment and Inactivity Traps in the Czech Republic: Incentive Effects of Policies," Working Papers 2007/9, Czech National Bank, Research Department.
    4. Jiří Večerník, 2004. "Social Policies and Structures Under Transition: Cohesion and Tensions," Prague Economic Papers, University of Economics, Prague, vol. 2004(4), pages 310-322.

    More about this item

    Keywords

    Czech Republic; fiscalité; République tchèque; taxation;

    JEL classification:

    • H2 - Public Economics - - Taxation, Subsidies, and Revenue

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