Slovakia to impose 4.2% extra tax on regulated utilities in 2012, 2013.

By bne IntelliNews May 30, 2012
Slovakia plans to slap a special 4.2% one-off tax on the earnings of utilities in regulated sectors for this and next year in a bid to raise the state revenue and achieve its budget consolidation targets, TASR news agency reported. The extra tax will be applied to companies in the energy, telecoms and postal sectors, on top of regular corporate tax that is proposed to rise to 23% from currently 19%. The companies that will be taxed additionally should have an annual profit of at least EUR 3mn, Prime Minister Robert Fico told reporters. He added that the cabinet aims to collect EUR 100mn a year through the special tax and use them for financing activities aimed at boosting the economic growth. Slovakia needs to find some EUR 200mn in reduced expenditures or increased revenues this year to meet its 4.6% budget deficit target and up to EUR 1.5bn next year to reduce the shortfall to fit within the EUs 3% ceiling. Fico has already proposed an extra tax on banks, aiming to raise additional EUR 75mn this year and EUR 100mn next year. The proposals need to be approved by the parliament, where Ficos social democratic SMER-SD party has a sweeping majority of 83 deputies out of 150 seats. Slovakias main electricity producer, SE, is majority owned by Italy's Enel, the gas sector is dominated by SPP, 49%-owned by Gaz de France and Germanys E.ON, and the three mobile operators are run by Deutsche Telekom, France Telecom and Spanish Telefonica.

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