Government approves proposal to lower income tax for low and medium income groups

The government has approved a proposal for the abolition of the so-called “super gross” wage which would significantly lower people’s taxes.

The proposal would see income tax cut from the present 20 percent to 15 percent for low and medium income groups. People with an income of over 139,000 crowns a month would pay a 23 percent tax.

The super gross wage, which has been the base for calculating employee income tax since 2008, is the sum of an employee’s gross wage plus social and health insurance premiums.

Previous attempts to abolish the super gross wage failed because of the loss to state revenues.

Now the government wants to push it through so as to encourage consumer spending and help rev up the economy post-coronavirus. The fallout to state revenues would be 74 billion crowns.