The 2011-12 tax on emission allowances has been
suspended until the Constitutional Court rules on its
The suspension came just in time, as the relevant
advance on tax is payable twice-yearly and the next deadline for
payment together with the deadline for submission of the first tax
return is approaching (30 June).
The tax has a very high rate (80%) and is payable
on any monthly emissions allowances that are unused in that month
by a participant in the emissions trading scheme. It only applies
to allowances in 2011-12, as a new five-year scheme is being
adopted for allowances in 2013-17.
Members of the Slovak parliament initiated the
decision by the Constitutional Court to suspend the relevant
provisions of the Emissions Trading Act.
The introduction of the tax is not only
controversial within the Slovak Republic but is already being
looked into by the European Commission. The implications of the
Constitutional Court’s decision are uncertain as yet but, if
it does declare the tax to be unconstitutional, it is quite
possible that some businesses that have been subject to the tax
will sue the Slovak Republic for damages.
Law: Act no. 572/2004 Coll. on emissions
trading, as amended