Ministry of Finance Proposes Zero VAT Rate On Gas And Electricity
The sharp rise in gas and electricity prices is falling on low-income families and small and medium-sized enterprises, prompting the Ministry of Finance to submit a request to eliminate the rate on gas and electricity bills. Credit: Freepik
Czech Rep, Oct 20 (BD) – On Monday, October 18th, the Ministry of Finance proposed to the European Commissioner for Economic Affairs to eliminate the VAT rate for the supply of electricity and gas as early as November and December of this year.
“This is undoubtedly a completely extraordinary situation, to which any responsible government must react immediately,” said Finance Minister Alena Schillerová. “As with respirators, where the reduction in VAT had an immediate impact on prices for final consumers, we want to support Czech families by introducing a zero VAT rate on electricity. A household that pays CZK 1,000 per month for electricity will save around CZK 350 on their bills in November and December alone. The rising prices of these key commodities should therefore be felt by households significantly less or not at all.”
In addition to this temporary solution, the Ministry of Finance will also propose an amendment to the VAT law, which could come into effect as early as January 2022. However, the passage of such an amendment depends on political support from the incoming government.