The conference organized by the Ministry of Finance on 7-8 August 2024, focused on changes to property tax regulations. Its aim was to discuss proposed new provisions and received feedback that could influence the final version of the amending legislation. Below is a summary of the key agreements.
First Day of the Conference
The Ministry of Finance presented its position, emphasizing that the main goal of the amendment is to align the definitions in property tax regulations with constitutional requirements, while avoiding an increase in tax burdens for businesses.
Key Takeaways from the First Day:
– Taxation of Only Building Components of Photovoltaic Systems: Only the building components of photovoltaic installations and energy storage systems will be subject to tax. Technical devices, such as solar panels, inverters, and distribution boards, will be exempt from taxation.
– No Definition of “Building Components” in the Legislation: The Ministry has decided not to introduce a definition of “building components” or “non-building components” in the legislation. Interpretation of these terms will rely on existing linguistic and systemic interpretations.
– Distinguishing Between Buildings and Structures: A clear distinction between buildings and structures will be introduced. However, the Ministry does not support adding new defining features for buildings, such as surface area. Business representatives pointed out the need to consider dominant characteristics when classifying silos and elevators.
– Definition of Buildings and Structures: The definition of buildings and structures will be refined to specify that an object must result from construction work or a building process. This aims to exclude technical components of buildings and structures from taxation.
– Taxation of Structures Inside Buildings: The Ministry upheld the concept of taxing structures within buildings, but only in cases specified by the legislation, such as boiler foundations or linear objects passing through buildings.
– Permanent Connection to the Ground: The Ministry plans to differentiate the definition of a permanent connection to the ground depending on the type of object. For buildings, deep foundations will be key, while for structures, construction work will be the determining factor.
– Containers and Tent Halls: Containers with foundations will be taxed as buildings, while those temporarily placed on the ground will not be subject to tax. The Ministry intends to maintain current regulations, which tax containers and tent halls only if they meet the definition of a building, though this issue will be further analyzed.
– Exemption for Technical Devices: It was repeatedly emphasized during the conference that technical devices, such as elements of production installations, should not be taxed as part of structures. This issue will be subject to further work on the project.
Second Day of the Conference
Key Takeaways from the Second Day:
– Telecommunications and Electrical Networks: Despite numerous comments from businesses, the Ministry of Finance does not plan to retract the classification of networks as structures. This may result in the taxation of devices that were previously not subject to property tax.
– Division of Stadiums: There are plans to separate stadiums into buildings and structures, which could impact the amount of tax liabilities, especially regarding the classification of stands as buildings or structures.
– Taxation of Technological Pipelines and Tanks: Discussions on the taxation of these objects were particularly intense, and the Ministry of Finance announced further analysis on this issue.
– Hydrotechnical Structures: There are plans to introduce a detailed list of hydrotechnical structures subject to property tax, aimed at eliminating uncertainties in this area.
– Small Architectural Objects: The Ministry plans to introduce a new definition of “other small objects” that will exclude small architectural objects from property tax.
