An Effective Source Of Local Government Budgets Of Local Taxes In Slovakia Presented by: Prof. Dr. Štrkolec and Dr. Vartašová Date: 11 – 13 January 2025 System of LT in SVK - - System of LT (since 2005): • Real property tax • Dog tax • Accommodation tax • Non-winning gaming machines tax • Vending machines tax • Tax on use of public areas • Tax on entering and stay of motor vehicles in the historical part of towns, • Nuclear facilities tax + 2 local fees (LT sensu largo): • Local fee for municipal waste and minor construction waste (since 2005) • Local fee for development (since 2017) Characteristics Of The LT System Characteristics Administration RPT Dog tax Accommodation tax Non-winning gaming machines tax Vending machines tax Tax on use of public areas Tax on entry & stay of motor vehicles Imposition Municipality Municipality Municipality Voluntary Voluntary Voluntary Tax Rates Limits Yes, partial No No Municipality Voluntary No No Municipality Voluntary No No Municipality Voluntary No No Municipality Voluntary No No No No No Nuclear facilities Municipality tax Municipal waste Municipality fee Local Municipality development fee Voluntary Mandatory Yes, TR set by No law Yes (range) Yes Voluntary Yes (range) Yes Legislation on LT(&F) - State adopted legislation: • no. 582/2004 Coll. on local taxes and local fee for municipal waste and minor construction waste • - act no. 447/2015 Coll. on local fee for development Municipally adopted legislation: • Generally binding regulations:  Imposition of LT&F setting tax rates reliefs and exemptions reporting duties payment details Municipal Funding - The System - - Background = Constitution of SR: • Art. 65): Municipalities finance their needs primarily from their own income. • (Art. 59): Taxes and fees are state and local. However, the system of municipal funding is more complex, comprising: • revenues from local taxes & fees • non-tax revenues from the ownership and transfer of municipal property • interest and other revenues from the funds of the municipality • sanctions for violations of financial discipline imposed by the municipality • donations and revenues from voluntary collections to the municipality • the share of the taxes administered by the State • other revenues on the condition that a special law provides so expressly • subsidies:  from the State budget covering the costs of the transferred performance of the State administration  additional subsidies from the State budget  purpose-built subsidies from the HTUs or other municipality to carry out contracts under special laws • funds from the EU Municipal Funding – The Problem - - LT&F • = aver. only 11% of revenues of municipalities • = dependence on state funds! EU Charter of LG (Art 9): • fully accepted (2007), but: • not all duties fully applied in practice • (sufficient & diversified resources, resources corresponding to the competences, consultations...) - - LT&F • = RPT CCA. 7-8% • = the rest of LT has no real budgetary sense • yet, RPT = 0.4% GDP • = the need for reform of RPT Investment issues: • = if municipality wants to invest, they need to take loans