Report on the Coordinated Audit Tax and subsidy support for climate and energy policy in the Czech and Slovak Republics

Report ID: 296

On the basis of a Cooperation Agreement between the Supreme Audit Office of the Slovak Republic and the Supreme Audit Office of the Czech Republic, both SAIs carried out a coordinated audit on tax and subsidy support for climate and energy policy in their respective countries.

The aim of the audits was to verify whether the support in the Czech and Slovak Republic is set up to contribute effectively to the fulfilment of objectives in selected areas of climate-energy policy while maintaining the long-term sustainability of public revenues. Selected areas were the transport sector and photovoltaic support.

 The theme of coordinated audits has been selected on the basis of the fact that both Member States, based on common European legislation, apply different support systems at national level in selected areas of climate and energy policy, aiming to meet the basic climate and energy objectives of the European Union  by 2020.

The EU has set ambitious climate-energy policy objectives, the successful enforcement of which includes a set of measures, including various financial instruments. Each EU Member State can choose its own procedures and tools to achieve the objectives. This gives space for comparing the effectiveness and efficiency of the instruments chosen between the individual countries. Based on the achieved indicator values, the Supreme Audit Institutions compared the quality parameters of the support and evaluated their impacts on the achievement of the EU and national targets. The coordinated audit of the SAO CR and the SAO SR again proves that both institutions attach great importance to international comparisons.

For comparison purposes, financial values and indicators were compared in euros. Amounts in Czech crowns were converted into euros at the exchange rate of the CNB as at 17 September 2019, i.e., according to the CNB € 1 = CZK 25.88.

Source: https://www.nku.gov.sk/documents/10272/1542112/2020+-+Tax+and+subsidy+support+for+climate+and+energy+policy+in+the+Czech+and+Slovak+Republics.pdf

Joint Report on the Results of Parallel Audits of Excise Duty Administration in the Slovak Republic and in the Czech Republic

Report ID: 344

Legislation in the Czech Republic and in Slovakia on excise duty and its administration complies with EU legislation and exceeds EU requirements substantially. Differences have been discovered between Slovak and Czech excise duty regulations: in the Czech Republic, verification of the economic stability of applicants for permits and mandatory labelling and dyeing of several mineral and some other oils contribute to effective excise duty administration; in Slovakia, the distribution of excise stamps is simpler than in the Czech Republic and less of a burden on excise duty administrators. In the fight against excise duty evasion, supervising the movement of raw tobacco or tobacco materials, the implementation of the institute of a transport fuel distributor, and keeping a registry of merchants of consumer packaged alcohol appear to be a good practice in the fight against excise duty evasion. Excise duty revenues in the Czech Republic and in Slovakia grow more slowly than other tax revenues

In August 2015, The Supreme Audit Institutions of  Czech Republic and Slovakia agreed to conduct parallel audits aimed primarily at excise duty administration an signed an Agreement for this purpose. The topic of the parallel audits was chosen because both EU Member States follow common European legislation on this matter, thereby providing an opportunity to ascertain how European legislation is applied on a national level, how the excise duty administration system is set up, and how the system in Slovakia and the system in the Czech Republic differ.

The audit questions on which the parallel audits were based were agreed jointly. The parallel audits aimed to compare the performance of the excise duty administrators while taking into account qualitative and quantitative indicators and identifying weaknesses in the excise duty administration process. Answers to the following audit questions in particular should have been sought:

- Have excise duty administrators in the Czech Republic and Slovakia been attaining comparable values of qualitative indicators while incurring comparable costs?

- Has implementation of the EMCS1 resulted in more effective excise duty administration and has been spending on its implementation effective?

- The joint final report on the audit results was drawn up in accordance with ISSAI 300 - Fundamental Principles of Performance Auditing

Source: https://www.nku.cz/assets/publikace-a-dokumenty/ostatni-publikace/spolecna-zprava-kontrola-spotrebni-dane-cr-sr_en_1.pdf