Tourist trains will run on new routes in the next year and a half
A recent surge in shopping tourism is posing a significant threat to Slovakia's economy, according to financial analysts. This trend has emerged in response to a recent increase in value-added tax (VAT).
The VAT hike, intended to bolster the government's budget, has sparked a mixed reaction from the Slovak public. In response to rising prices, many Slovaks have turned to shopping tourism, effectively avoiding paying higher taxes at home.
Residents of border regions have been increasingly crossing into neighboring countries to make purchases. This trend extends beyond personal shopping, as the flow of goods imported into Slovakia from neighboring countries has reached industrial proportions.
Items being smuggled include traditional products like fuel, tobacco, and alcohol, as well as food, footwear, clothing, and even Christmas trees. Independent auditing firms have confirmed an increase in the black market, with annual consumption of contraband cigarettes rising by 52%.
This surge in shopping tourism is a direct consequence of increased taxes, which have been on the rise in Slovakia for the past four years. Financial experts predict that instead of increasing government revenue, these tax hikes will lead to a decline in tax collection. Despite this, the Slovak government plans to continue raising VAT rates. The potential responses of cross-border shoppers remain to be seen.
