Text file: 8348.txt
author: salabajsek.dzipsi
downvotes: 14
end consideration date: 2017-06-24
id: '8348'
number comments: 5
number views: 4417
proposal type: Competent authority response
response: "Response from the Ministry of Finance\nI. By way of introduction, we would\
  \ like to point out that the issue of contributions to pension and invalidity insurance\
  \ raised relates to the regulation in the Law on Pension and Disability Insurance\
  \ (ZPIZ-2), which is the responsibility of the Ministry of Labour, Family, Social\
  \ Affairs and Equal Opportunities. The Ministry of Finance can only respond to the\
  \ part of the proposal relating to the tax treatment of personal income, which is\
  \ governed by the Income Tax Act.\nII. The primary purpose of taxation is to raise\
  \ public revenue, which is indispensable for the normal functioning of any state.\
  \ It is used by the State to ensure and enhance a fair standard of living and quality\
  \ of life for all its citizens.\nThe taxation of personal income is governed by\
  \ the Income Tax Act (hereinafter referred to as 'ITA-2'), the fundamental principle\
  \ of which is the equal tax treatment of income. A deviation from this principle\
  \ could lead to unequal treatment of taxpayers with regard to income which is similar\
  \ in substance.\nAny payment or receipt of income, irrespective of the form in which\
  \ it is paid or received, is regarded as income. The Income Tax Code (ZDoh-2) provides\
  \ that income from employment is any income received by an employee from his employer\
  \ in respect of an employment relationship. According to Article 37 ZDoh-2, in addition\
  \ to salary, income from employment includes annual leave allowance and profit-sharing\
  \ income (Christmas bonus), which are listed in the proposal to abolish taxation.\n\
  III. The allowance and the Christmas bonus are income from employment as defined\
  \ by the labour law. The right to a regimental allowance is a right provided for\
  \ in Article 131 of the Labour Code, which the employer is obliged to pay. The legislator\
  \ has recognised the specific nature of this income and has provided for an exemption\
  \ from contributions of up to 70 % of the average wage of employees in Slovenia\
  \ (Article 144(3), third indent, of the ZPIZ-2). The same applies to income based\
  \ on participation in profits (Christmas bonus), for which, under certain conditions,\
  \ up to 70% of the average wage is not included in the tax base (Article 44(1)(12)\
  \ ZDoh-2).  IV. Despite the above-mentioned adjustment of the tax and contribution\
  \ base, the legislation still maintains the principle of equal treatment of income.\
  \ However, if the proposed abolition of contributions to pension and invalidity\
  \ insurance and the abolition or reduction of income tax, which would apply only\
  \ to some of the income from employment, were to be implemented, the fundamental\
  \ principle of equal treatment of income would be undermined. The taxable amount\
  \ would then depend on the taxable person's or his employer's decision as to how\
  \ to allocate the income to the different categories of employment income.\nV. The\
  \ regratuity and the Christmas bonus are not gifts to the employee, either in the\
  \ form of income or in the substance, but forms of income which are connected with\
  \ employment. The abolition or substantial reduction of taxation or the payment\
  \ of contributions would result in unequal treatment of taxpayers with substantially\
  \ similar income, and we therefore consider that the Government's proposal to abolish\
  \ the taxation of regress and the Christmas bonus is not appropriate for further\
  \ consideration.\n "
response date: 2017-08-01
response due date: null
sent date: 2017-05-26
title: Abolition of taxation on recourse and Christmas bonuses
upvotes: 19
url: https://predlagam.vladi.si/predlog/8348
