Slovak Financial Law News 2004

New Act on Beer Excise Tax

Act No. 107/2004 Coll. on Excise Tax on Beer

The new Act on Excise Tax on Beer (the ``Act'') repeals and replaces the previous Act No. 310/1993 Coll. on Excise Tax on Beer, as amended.

The purpose of a new conception of the Act is especially to implement provisions of the principal Directive 92/12/EEC on the general arrangements for products subject to excise duty and on the holding, movement and monitoring of such products, which is reflected by the introduction of a mechanism for the operation of tax warehouses, authorized recipients and related tax suspension and quarantee of tax payment, in the monitoring system of movement of the products through circulation of an accompanying document, consistent keeping of registers which enable monitoring of production, import, export, movement and consumption of beer, with the aim to minimalise possible tax avoidance.

The Act regulates the taxation of beer which is subject to excise tax within the tax territory which is considered to be the territory of the Slovak Republic.

The subject of tax is beer produced in the tax territory, supplied to the tax territory from any other Member State of the European Union, or imported into the tax territory from a third country. The term ``beer'' shall mean, for the purposes of this Act, alcoholic beverages stated in Section 4(2) of this Act.

Tax administration is carried out by the customs office. Territorial jurisdiction of the customs office shall be governed by the registered office in case of a legal entity, or the permanent residence in case of a natural person.

The tax base is the quantity of beer expressed in hectolitres. The tax shall be calculated as a multiplication of the tax base, concentration of beer in degrees Plato and particular tax rate. As for the tax rates, these are stipulated as follows: (a) basic tax rate shall be SKK 50/degree Plato/hl, and (b) reduced tax rate shall be SKK 37/degree Plato/hl.

The reduced tax rate shall apply to beer produced by so-called small independent brewery.

Unless the Act stipulates otherwise, the tax duty arises by release of beer for tax free circulation.

The taxation period is essentially one calendar month. The Act also regulates a time period for filing a tax return and the tax maturity.

The Act also regulates conditions for exemption of beer from tax, tax refund and it also defines several important terms, such as an enterprise for beer production, tax warehouse, beer warehouse, authorized recipient and tax representative.

The term ``enterprise for beer production'' shall mean, for the purposes of the Act, a territorially bounded place situated within the tax territory (in the Slovak Republic) in which beer is produced, processed, stored, received or dispatched within its business activities.

The Act also regulates in detail the issues related to the transfer, import and export of beer as well as the issue of beer forwarding business.

The customs office may impose a penalty on a legal entity or natural person for breach of its duties in the disposal of beer up to the amount of tax pertaining to the quantity of dispatched beer, however at least in the amount of SKK 10,000.

This Act came into force on 1 March 2004, save for certain provisions which became effective on 1 May 2004.

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