The Prague Post
Hotel booking
November 22nd, 2008
Endowment Fund     Business Listings ONLINE      Reservations      Classifieds    Subscriptions
Prague Property

Home » Archives » News

Social security treaty signed

Agreement may end tax burden for Czech and U.S. workers

By Markéta Hulpachová
Staff Writer, The Prague Post
September 12th, 2007 issue

Some employees may soon pay less social security tax following a new agreement between the Czech and U.S. governments.
U.S. Ambassador Richard Graber and Labor and Social Affairs Minister Petr Nečas signed a bilateral treaty Sept. 7 that aims to abolish double social security taxation in the two countries.
The treaty will benefit U.S. citizens employed at Czech companies, as well as Czech employees working for U.S.-based firms. The current law requires such individuals to make social security payments in both countries.
The agreement “ensures U.S. and Czech workers and their families receive the social security benefits they have worked for,” Graber says.
Effective retroactively, the treaty makes it possible for U.S. and Czech workers to receive prorated benefits from either country based on the total amount of social security payments they have made there.
Before coming into effect, the agreement is subject to ratification in Parliament and the U.S. Congress.
Once ratified, the agreement will affect approximately 4,400 Czech and American workers over the next five years, according to a statement issued by the U.S. Embassy.
While similar agreements exist between the United States and 21 other countries, including Canada, Chile and Japan, the treaty with the Czech Republic is the first of its kind in Central and Eastern Europe, Graber says.
By removing excessive bureaucracy, the United States hopes the treaty will help foster economic relations.
“Eliminating the burden of double taxation encourages deeper, more stable business partnerships,” Graber says.
Although the prestige of U.S. companies still lures many Czech employees, there is a declining interest in U.S. employers among Czechs.
“The demand for U.S. jobs is dictated by the currency,” says Industry and Trade Ministry spokesman Tomáš Bartovský. “Since 2002, the crown’s strength to the dollar has doubled, and a significantly smaller number of Czechs are rushing to work for U.S. companies.”
According to the Czech News Agency, Graber said he will urge U.S. President George W. Bush to encourage speedy approval by the U.S. government.
The Labor and Social Affairs Ministry expects to implement the new regulations next year.

Markéta Hulpachová can be reached at mhulpachova@praguepost.com


Other articles in News (12/09/2007):

Browse the Current Issue

If you enjoyed this article, why don't you subscribe to the print version!
We accept secure online transactions provided by PayPal and Moneybookers

Be the first to add a comment!


Full Name: *
City: *
E-mail: **
This comment can be published in the print version of The Prague Post
Enter the text on the right:
 visual captcha
Comment: *
* Required field. In order to be approved for display, comments must have a first and last name and a city.
** E-mails are required and will only be used for internal purposes.

Most visited in Business Listings

Hotel booking
The Prague Post Online contains a selection of articles that have been printed in
The Prague Post, a weekly newspaper published in the Czech Republic.
To subscribe to the print paper, click here.
Unauthorized reproduction is strictly prohibited.