Podcast with Ivan Mikloš about the 2003 tax reform

Podcast with Ivan Miklos about the 2003 tax reform. A substantive debate also on the pitfalls and shortcomings of the current setup. Judge for yourself. In 2025, a company with taxable income of, say, €500,000 and a profit of €200,000 would have to pay income tax of €42,000. However, if it were to ‘split’ into 5 companies with revenues of EUR 100 000 each, those 5 companies would pay a total of EUR 20 000 in tax. 🚩 Unimaginable? Already today, some “companies” are also split into 20 small companies so that none of them exceeds a turnover of EUR 49 790 in VAT.
🚩 Is this legal? Sometimes yes and sometimes no. Tax advice here must be combined with legal advice and, for example, a proper grounding in the theory of administrative law. Similar to the question “Can I sell my flat for EUR 1 000 and the movables in it for EUR 199 000?” (more info here: https://lnkd.in/empdqis4) Or. Some Slovak IT companies in principle do not have to pay income taxes “for life”. However, they have to meet three basic conditions: ✅ They must do qualified development;
✅ they must have less risk aversion; and
✅ they must be lucky. Why the second and third points? Because although the government has introduced good faith incentives for IT development companies, it has not followed through. Neither the methodology nor the MoF answers basic questions such as (simplistically) (i) the impact of contractors, (ii) the impact of upgrades, (iii) the residual utility aspect of the software/invention/technical solution, … That’s like a speaker who puts in a quote about blood, but doesn’t follow through in that research … And so, for those IT firms (and others) in legal and tax consulting practice, we have to specifically set it up to gain a legitimate tax advantage, but minimize the associated risks. Or the issue of taxation/non-taxation of ETFs (I’ve discussed more here: https://lnkd.in/eedstFvc) Etc. Otherwise, did you know that while in 2003 the Income Tax Act only had one tax rate (19%), in 2025 it is expected to have up to 8 (or 9)? Lenka Buchlak and Ivan Miklos and I also discussed these issues in the context of the 2003 tax reform in the next episode of Highgate Talks on Highgate Law & Tax. You can find the link in the comments. The podcast has had 4,500 views on YouTube in 10 days, which is actually a record for our humble Highgate Talks.