Taxes Levied on Legal Entities: Profit Tax, VAT, Excise, Real Estate, Land, and Environmental Tax
Profit tax
Profit tax is levied on gross profit (revenue less costs) with a standard rate of 18 percent. Know the rules for recognition of revenue on an accrual basis, the list of non-deductible expenses, and loss carryforward (limited to ten years). Traps cluster around the treatment of fines, charitable transfers, and representation expenses (normed as a percentage of payroll).
VAT
The standard VAT rate is 20 percent, with a reduced 10 percent rate for specified goods (certain food and children's goods) and 0 percent for exports given proper documentation. Understand the offset method: input VAT is credited against output VAT, with excess carried forward or refunded under conditions. Registration thresholds and the moment of determination of the tax base (generally the earlier of shipment or payment) are frequent question targets. Watch for export confirmation deadlines and the special rules for construction and imports.
Excise
Excise applies to alcohol, tobacco, petroleum products, and certain other goods, at specific (per-unit) rates indexed periodically. Trap: the taxpayer is the producer or importer, and the base is volume, not value, for most excisable goods.
Real estate, land, and environmental taxes
Real estate tax applies to buildings and structures at rates set annually (with reliefs for certain categories). Land tax depends on cadastral value and land category, and environmental tax is levied on emissions, discharges, and waste disposal within established limits, with higher rates for exceedances. A common trap is confusing the taxpayer of land tax (the land user) with the owner, and misapplying the multiplier for above-limit emissions.
Worked example
Exporter ships goods in March, receives payment in May, and confirms export by the deadline. If export documentation is complete, the 0 percent rate applies and input VAT is refundable; if documentation is late, the sale is taxed at 20 percent.