An average household could lose 44,000 kroner a year due to the government’s package, the analysis says.

For example, an employee with a total income of 40,000 crowns and two children over three years of age would lose 44,000 crowns per year according to these calculations, which is almost 4,000 per month. If he earns a total of 20,000, he will lose 6,600 crowns in a year. According to BDO calculations, the income of 140,000 recipients per month would be reduced by 70,500 crowns.

Among other things, the government coalition wants to abolish kindergarten fees, limit the spousal tax to those caring for a child under the age of three, cancel non-cash benefits for employees or reintroduce health. Insurance payments to employees.

“According to our calculations, in percentage terms compared to net income, households with children and average income will feel the changes the most, with their net income falling by up to a tenth,” said Monica Lodroa from BDO.

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According to him, with higher salaries, people will lose more amount as a result of consolidation package, but in relation to their current net income, it will be only five percent. However, the impact could be even greater due to the proposed repeal of the tax exemption for employee benefits.

The main reasons people on average incomes and with young children are most upset are the proposed cap on the spousal allowance and the scrapping of kindergarten fees. BDO said that even if a low-income employee has a low tax assessment, he has not used these rebates yet or only to a limited extent, an average-income employee can use them to the maximum. “Instead of a tax bonus, he will get a new tax liability at the end of the year,” BDO said.

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Compared to employees, self-employed people with similar monthly incomes do not expect such fundamental changes, according to the analysis. 35,000 per month for self-employed and entrepreneurs using flat-rate expenses of 60 per cent, the tax liability does not and will not arise. “Due to the increase in social insurance, they will now have about 7,000 crowns less per year. However, the assessment base should continue to increase in the following years, which means that in 2026 the minimum contributions will increase by about 60 percent compared to the current situation,” the agency said.

A self-employed person with an income of 60,000 per month and two children above the age of three at the same time, using the discount for a husband or wife, may feel the changes a little more. Instead of a tax bonus of 37,500 crowns a year, he will now receive more than 25,000 crowns.

A self-employed person in the same family situation and with an income of 140,000 kroner per month would not receive the tax bonus and would pay 52,000 kroner more per year in taxes and contributions.

The government’s proposals will apply from 2024 and the government is due to debate them in the second half of June, after which the consolidation package will be considered by both houses of parliament.

Expert: Package will shrink economy by 0.8 percent


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