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Czech Property Tax to Rise Next Year

World

Most people in the Czech Republic will see an increase in their property taxes next year, with some potentially paying thousands more, wrote news portal Czech Daily.

"Current property tax rates for 2024 will increase to approximately 1.8 times their current value. This increase applies to all immovable property, provided it is not exempt from tax or the subject of tax", said Finance Ministry spokesperson Petra Vodstrčilová.

Although municipalities will have the option to reduce the tax by about a tenth, few are expected to do so, according to local government representatives. For instance, this year, people paid CZK 1,720 (some EUR 71) for a 70 sqm apartment in a residential building in Prague's Žižkov area.

Next year, with the proposed increase in the basic tax rate, the amount is projected to rise to CZK 3,010, according to calculations by the Financial Administration.

According to František Lukl, chairman of the Association of Towns and Municipal ities, even wealthier municipalities, which earn income from various sources like property rentals and capital gains, might opt for this approach, benefiting residents but potentially raising taxes for entrepreneurs

. However, Lukl believes that taxes will increase across the board in most municipalities by 1.8-fold. He pointed out that 90% of cities have a coefficient of one, meaning they haven't previously worked with coefficients.

The decision is influenced by past inflation and energy costs, which have not compelled municipalities to burden residents with higher tax rates. Compared to the original package proposal, state coefficients are no longer considered for property tax. However, the inflation coefficient remains in the new government structure for property taxes.

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