KDH: Transaction Tax Will Hit Slovakia Hard, Needs to Be Scrapped (2)

Bratislava, April 1 (TASR) - The transaction tax will hit the Slovak economy hard, particularly the self-employed and employers, which is why it should be scrapped, as Slovakia is set to experience the adverse effects of the tariffs that are about to imposed by the United States on all EU exports, MPs Milan Majersky and Jozef Hajko (KDH) stated at a press conference on Tuesday. "The government of Robert Fico (Smer-SD) is incapable of facing the current challenges and threats that we have in Slovakia, whether it be the transaction tax, the danger of US tariffs or foot-and-mouth disease. These threats are so serious that they jeopardise the future of the Slovak Republic and its inhabitants," claimed Majersky. The transaction tax came into effect as of Tuesday and is due to hit Slovakia's economy extremely hard, said Hajko. It will impact mainly the self-employed, who have been forced to set up business bank accounts from which they must pay tax from every financial transaction to the state. Aside from this, the tax will affect employers as well, as they'll have to pay €50 annually for every single employee with the average Slovak salary. Another problem lies in a 'back-to-cash retreat', with many restaurants already calling on visitors to pay for meals and services in cash in order to spare them from paying the transaction tax. The government plans to collect about half a billion euros via the transaction tax this year and €700 million next year. Hajko stressed that the transaction tax will discourage not only entrepreneurs in Slovakia but will also drive away foreign investors. He expects Slovak businesses to switch to foreign payments, so the only solution is to scrap the tax. The second problem threatening Slovakia concerns the 25-percent tariffs to be imposed on all exports of goods from the EU to the United States as of April 2, 2025. Slovakia's pro-export economy, dependent on exports of automobiles and their components to the United States, will feel the sting of the tariffs to a special degree. About 20,000 jobs might be lost in Slovakia as a result, which would also be translated into losses in incomes from taxes and levies for the state. In 2023, Volkswagen and Kia were the largest payers of taxes and levies, bringing more than €500 million into state coffers. "The government should pass a clear economic policy for the long term to make it clear in what direction it wants to go and how to decrease our dependency on automobile production slightly," said Hajko. mf/df