December 13, 2018 / 4:10 PM / a year ago

Slovak lawmakers slap new tax on retailers

BRATISLAVA, Dec 13 (Reuters) - Slovakia’s parliament on Thursday approved legislation levying a special tax on retail chains to raise money for the support of local food production.

As of next year, a tax amounting to 2.5 percent of a retailer’s revenue will apply to businesses that sell at least 25 percent of foodstuffs and have outlets in two or more regions.

It is expected to raise 87 million euros in the first year toward a new marketing fund overseen by the agriculture ministry to promote Slovak food producers and compensate them for losses caused by bad weather and climate change, the draft law said.

The bill, put forward by lawmakers from the junior ruling coalition member Slovak National Party (SNS), sparked criticism among business associations and the country’s president.

“The new tax is an unsystematic tool that discriminates against some retail chains (...) based on arbitrary criteria,” President Andrej Kiska said on Wednesday before parliament overturned his previous veto of the legislation.

Slovak Modern Trade Alliance (SAMO), which represents local branches of Tesco, Billa and Metro among others, said it saw any additional taxation of a selected group of entrepreneurs to be discriminatory and a violation of EU law.

Businesses in Slovakia pay 21 percent corporate income tax, the highest rate among central European countries. (Reporting by Tatiana Jancarikova Editing by Mark Heinrich)

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