Changes in tax laws in connection with the consolidation package

On October 9 2025, Act No. 261/2025 Coll . entered into force in connection with the consolidation of public finances, which brings several changes also in the tax area. The changes will affect employees, self-employed persons and households.

I. Increasing progressivity of personal income taxes

The change will mainly affect people with above-average income. The new income tax rates will be applied according to the annual tax base as follows:

44 000 € = 19% (rate unchanged), corresponds to a monthly gross salary up to 4 282 €
over 44 000 € = 25% (corresponds to a monthly gross salary from 4 282 € to 5 875 €)
over 60 000 € = 30% (corresponds to a monthly gross salary from 5 875 € to 7 302 €)
over 75 000 € = 35% (corresponds to a monthly gross salary above 7 302 €)

Constitutional officials and deputies will have an additional taxation of +10%:

up to 44 000 € = 19% + 10% = 29%
over 44 000 € = 25% + 10% = 35%
over 60 000 € = 30% + 10% = 40%
over 75 000 € = 35% + 10% = 45%

II. New tax license band for the largest companies (corporate income tax)

The Ministry of Finance is introducing a new tax license band, which will only apply to large companies with taxable income over 5 million euros. The new minimum corporate tax limits will be as follows:

up to 50 000 € – 340 € – no change
up to 250 000 € – 960 € – no change
up to 500 000 € – 1 920 € – no change
up to 5 000 000 € – 3 840 € – no change
over 5 000 000 € – 11 520 € (previously 3 840 €)

III. Health contributions

From January 2026, everyone will pay higher health contributions. Employees will pay 5% of their salary (currently 4%) and the self-employed or self-payers 16% of their income (currently 15%). This means that more money will go to the health insurance company each month and the net income will be slightly lower.

IV. Self-employed persons – social contributions and contribution holidays

From 2026, the basis for calculating minimum contributions to the Social Insurance Company will increase from 50% to 60% of the average wage, meaning higher monthly payments. Minimum contributions will rise from 237.02 € to 303.11 € per month.

The “holiday period” for new self-employed persons will be shortened from one year to six months. After six months from starting a business, they must pay a minimum of 131 € per month. The goal is to prevent setting up businesses solely to avoid paying contributions.

V. PN and unemployment benefits

The unemployment benefit will gradually decrease from the 4th to the 6th month by 10% per month:

1st–3rd month = 50%
4th month = 40%
5th month = 30%
6th month = 20%

From April 2026, the employer will pay wage compensation during the first 14 days of sick leave (currently 10 days). From the 15th day, the Social Insurance Company will take over payments.

VI. Change in VAT on snacks

VAT on selected foods with increased sugar and salt content will increase from 19% to 23%. This applies to products such as chocolate, candies, ice cream, jams, sweetened soft drinks, chips, etc.

Basic ingredients like salt and sugar will keep their current VAT rate, as will foods for diabetics, baby food, 100% juices, and low-sugar or low-salt foods (e.g., whole-grain bread, unsalted corn crisps).

VII. VAT deduction for company cars

If an entrepreneur uses a company car for both business and private purposes, only 50% of VAT can be deducted. This applies to car purchases, leases, fuel, service, and repairs. A full deduction is allowed only if the car is used exclusively for business and proven by a detailed logbook.

VIII. Tax amnesty

The Tax Amnesty is in effect from January 1, 2026, to June 30, 2026. During this period, entrepreneurs can file additional tax returns and pay taxes without penalties or interest. The amnesty applies to income tax, VAT, excise taxes, motor vehicle tax, and insurance tax.

IX. Tax on negative externalities

From January 2026, the non-life insurance tax rate will increase from 8% to 10%. The change will affect household, property, vehicle, and travel insurance.

X. Changes in holidays and sales from 2025/2026

From 2025, November 17 will no longer be a non-working day (it remains a public holiday). In 2026, September 15 and May 8 will also stop being a non-working day.

The sales ban will apply only to six days: January 1, Good Friday, Easter Sunday, December 24 (after 12 pm), December 25, and December 26. Shops may open on other holidays.

XI. Further measures and the fight against leaks

From March 2026, all businesses must allow cashless payments for purchases over 1 €. Merchants cannot refuse card or QR payments upon customer request. However, customers can still choose to pay in cash.

XII. Changes in financial transaction tax

From January 1, 2026, self-employed persons and sole traders will no longer pay the transaction tax. It will apply only to legal entities (Ltd., joint-stock companies, and other firms).