According to the authorities, influencers avoid paying taxes. The state loses millions of crowns
Czech influencers earn hundreds of thousands to millions on the networks. Influencer marketing is full of money that creators get for advertising, collaboration, but also in the form of contributions from fans. Like everyone else, they are required to pay tax on this income. However, they are not very successful and the state is losing a lot of money. The General Financial Directorate wants to deal with the problem.
The Financial Administration found that many authors from the Moravian-Silesian region who work on Twitch and YouTube do not pay any tax on their income. In addition, some of the creators did not even pay value added tax, even if they sell products with their logo as a sideline – for example, t-shirts, bracelets or other fan merch.
The IRS found that there were big differences between what entrepreneurial influencers actually earned and what they declared on their tax returns. In addition, some did not file tax returns at all. “Only in the cases that have been concluded so far, handled by the Financial Office for the Moravian-Silesian Region, it amounted to a total of tens of millions of crowns, which were not transferred to public budgets,” said Jan Ronovský, Deputy Director General of the Financial Administration.
Influencers will be allowed to file taxes retroactively
The General Financial Directorate wants to be gentle with the creators and offered them the possibility to submit a tax return retroactively. In addition, they can pay taxes in the form of installment plans. However, due to the current findings, it is planned to continue to focus on influencers and monitor whether they pay taxes as they should.
Most influencers are self-employed and are required to tax their income based on the income from the activity itself. With the taxation of the finances earned on the YouTube platform, it can be even more complicated, due to the fact that the owner of the network is based in Ireland. Therefore, he does not have to pay taxes in the Czech Republic if he pays them abroad and has signed the Double Taxation Avoidance Agreement.
Among the cases of Czech influencers who have a problem with paying taxes and VAT, Datl’s is more unknown. Marek Valášek is insolvent and he owes part of the debt to the tax office, over 800 thousand crowns. Since February 2018, he has not paid VAT, although according to the law he should have. Datel has another debt to the health insurance company, but he also got into problems because of loans. Both in the bank and from non-banking companies. He also owes money on social security.