The government is proposing higher tax allowances for families with children, as well as a new benefit for expenses related to healthcare, education and sports activities. The draft amendments to the Personal Income Tax Act have been adopted by the Council of Ministers.
The existing tax allowance for one child is proposed to be increased to €5,000. For two children, the amount will be €10,000, while for three or more children – €15,000. An allowance of €12,000 is envisaged for a child with disabilities.
Up to €2,000 for Child Development
The new measure provides for up to €2,000 per child for expenses related to healthcare, education and sports activities. This means that payments associated with children’s development and activities will be covered.
The option of using tax allowances in advance during the tax year will remain in place. According to the proposal, this will increase the disposable income of families that meet the requirements.
„The aim is for administrative penalties to have a preventive and deterrent effect and to encourage voluntary compliance with tax legislation“, the explanatory notes to the amendments state.Changes to Declarations and Penalties
The draft sets out the procedure, the persons and the deadlines for declaring taxes due and for providing information on income paid when companies undergo transformation. The changes are also related to the automatic exchange of information between the member states of the European Union.
It is envisaged that the form submitted by pension insurance and insurance companies for the purposes of this exchange will be published on the website of the National Revenue Agency. Until now, it has been published in the State Gazette.
Fines and financial sanctions under the law are also being updated. The reason is that some of the amounts have not been changed since 2007. The proposal is for the sanctions to have a stronger preventive effect.
The measures are part of a bill and will have to be reviewed and adopted in accordance with the statutory procedure before they can take effect.