Setting a cap of 50 percent of the average monthly wage is insufficient, the government coalition agreed after discussions on the adjustment of the consolidation package with representatives of employers and trade unions. General Director of ASMP CR Eva Svobodová told ČTK.
In the consolidation package originally submitted to restore public finances, the government proposed the complete abolition of tax incentives for leisure benefits, saving 1.4 billion kroner.
“Macroeconomic calculations show that public budgets will lose more than 100 million crowns for every billion in the amount of benefits canceled. The amount of benefits in the economy is not known exactly, but it would be a deficit of one billion in ten billion. If benefits are only five percent of total wages, this is a very conservative estimate. , that’s an amount in the order of ten billion crowns,” Svobodova said.
According to Svobodova, if the limit is 70 percent of the average monthly salary, the maximum benefit contribution will be 2,330 crowns per month. “The maximum tax-free allowance for meals cannot exceed 70 percent of the value of the meal allowance as defined by the Labor Code for a domestic business trip lasting five to 12 hours, which is 2,240 kroner per month. At the same time, the flat rate is non-targeted and, unlike benefits, companies can include it in their costs,” he said. Svobodova justified the proposal of the ASMP CR.
He added, however, that support for leisure benefits would be significantly lower. “Regarding the annual average wage, the ceiling would be less than six per cent, which is a very small percentage,” he said. The finance ministry also announced on Thursday that the exemption limit would apply to “limited tax benefits”. However, Svobodova drew attention to the fact that the resort does not list them. “We don’t know what ‘defined’ benefits are involved,” he added.
According to Svobodova, nearly three million employees in the Czech Republic, or three-quarters of the workforce, use time off benefits. Among the most popular are contributions to the health sector, for example dentistry, rehabilitation or vitamins. However, employees also appreciate the support of sports activities and education, Svobodova said. He previously pointed out that if the government completely scrapped tax incentives for incentives, companies would stop offering them because it would be too expensive for them.
Miroslav Rech, director of Multisport Benefit, told ČTK that he welcomes the government’s decision not to fully cancel the tax exemption for benefits. “This is particularly good news for Czech employees, who will continue to receive contributions to support a healthy lifestyle. This will allow us to continue to expand our partner network and deepen our relationships with existing partners,” he said.
