Dun & Bradstreet: The number of unreliable VAT payers rose by nine percent

The number of companies that do not reliably pay value added tax (VAT) rose by nine percent year-on-year to 24,855 in the first half of the year. These are 5,092 unreliable VAT payers and 19,763 unreliable persons. It follows from the statistics of the consulting company Dun & Bradstreet Company. According to earlier statistics, there are roughly 529,000 VAT payers in the Czech Republic.

"Our long-term statistics indicate that the difficult market conditions in recent years, imposed by restrictions in the fight against covid-19 and subsequently problems with the disruption of global supply chains or price increases, have not yet had a significant negative impact on the increase in the number of unreliable VAT payers," said the analyst Dun & Bradstreet Petra Štěpánová.

Dun & Bradstreet records the most unreliable VAT payers and unreliable persons among limited liability companies. There are currently 515,741 of these registered in the Czech Republic, of which 19,406, i.e. 3.8 percent, are included in the list of problematic companies.

The statistics further show that while roughly 43 percent of companies and 17 percent of natural persons in the Czech Republic have their registered office in the capital, 56 percent of them on the black list of unreliable companies have a Prague address. A total of nine percent of unreliable payers and persons have an address entered in the commercial register at a virtual seat, i.e. an address where the service provider rents the address to a legal entity for the purpose of registration in the commercial register.

A company that does not have its tax documents in order and the office assesses a tax of at least CZK 500,000 is considered unreliable, as well as a company suspected of participating in fraud. A company that repeatedly fails to meet deadlines for mandatory submissions can also be labeled as an unreliable payer. Based on the decision of the tax administrator, a natural person or a legal entity can become an unreliable person. These are either entities that are not VAT payers and seriously violate the obligations related to tax administration, or entities that ceased to be VAT payers at the moment they were listed in the register of unreliable VAT payers.

Source: Dun & Bradstreet and CTK