New Slovak Financial Transactions Tax

As part of the consolidation package introduced by the Government of the Slovak Republic, Act No. 279/2024 Coll. has established a new financial transaction tax, which is set to take effect on April 1, 2025.

The taxable period for the remittance of the aggregate tax on individual financial transactions shall be a calendar month, meaning that the first taxable period will commence in April 2025.

Scope of the Financial Transactions Tax

The financial transaction tax will apply to the vast majority of business entities. Pursuant to the Financial Transaction Tax Act, the taxpayers (i.e., entities liable to pay the tax) shall include:

(a) ​legal entities (business corporations, civil associations);

(b) ​individuals – entrepreneurs (including Individuals registered in the commercial register, individuals conducting business based on a trade license, individuals engaged in business under a special authorization (e.g., doctors, attorneys, financial intermediaries) and individuals engaged in agricultural production);

(c) ​branches of foreign entities that are clients of a payment service provider executing financial transactions.

Additionally, taxpayers who are individuals and do not hold a payment account used for business-related financial transactions will be required to open a transaction account by 31.03.2025.

Taxable Transactions

The tax shall apply to the following transactions:

(a) ​financial transactions that result in the debiting of funds from a taxpayer’s account;

(b) ​use of a payment card issued for a transaction account to execute a financial transaction;

(c) ​reposted costs associated with financial transactions related to the taxpayer’s business activities conducted in Slovakia.

The Financial Transaction Tax Act also establishes several exemptions. Transactions related to tax, levy, and contribution payments that constitute state budget revenues, contributions to the Social Insurance Agency, and health insurance levies shall be exempt.

Furthermore, exemptions shall apply to payment transactions on a securities trader’s account when executed for the purpose of purchasing securities on behalf of a client. However, transactions related to a trader’s own securities purchases shall not be exempt.

Additionally, the tax shall not apply to payments made within the postal payment system operated by Slovenská pošta or to transfers between a taxpayer’s accounts held with the same provider (i.e., intra-bank transfers within the same financial institution).

Financial Transaction Tax Rates

The tax rate for cashless transactions (account transfers) shall be 0.4% of the transaction amount, capped at a maximum of EUR 40 per transaction.

The tax rate for cash withdrawals shall be 0.8% of the transaction amount, with no upper limit on the tax payable. The tax will apply to withdrawals at both bank branches and ATMs.

For payment cards, an annual tax of EUR 2 per card shall apply to each issued card used at least once in the year (excluding cash withdrawals). This tax shall apply to both debit and credit cards.

For cashless transactions, the tax will be debited from the sender’s (payer’s) account. For cash withdrawals, the tax will be debited from the account from which the funds are withdrawn.