On 28 December 2017, the Slovak Republic published Law 344/2017 in the Official Gazette. The law includes a number of tax reform measures, including:

• An expanded domestic definition of permanent establishment to include the recommendations of BEPS Action 7, including a 6-month aggregate threshold for construction/assembly project PEs, a 183-day aggregate threshold for service PEs, and provisions for a dependent agent PE, as well as the provision that transport and accommodation services may result in a PE in the Slovak Republic, even when through a digital platform;
• The introduction of a patent box regime in line with the modified nexus approach of BEPS Action 5 that provides for a 50% exemption on qualifying IP income in relation to patents, utility models, and computer software developed by the taxpayer, as well as an extended patent box that provides a similar exemption for qualifying income from selling goods that were manufactured on the basis of a protected patent or a utility model;
• An increase in the deduction of research and development costs from the prior 25% to 100%, as well as an additional deduction of up to 100% of the incremental increase in R&D expenditure;
• An additional withholding tax requirement with respect to Slovak source income that includes that tax is to be withheld at the rate of 35% if the taxable person cannot prove the identity of the final beneficiary;
• The introduction of a participation exemption for capital gains on the sale shares, provided that shares were acquired at least 24 months prior to the sale and represented direct participation of at least 10%, and the taxpayer in the territory of the Slovak Republic carries out essential functions, and manages and bears the risks associated with the ownership of the shares (the 24-month period generally begins 1 January 2018 for shares acquired before that date);
• New rules are introduced for domestic mergers and divisions, including that such reorganizations are measured at fair value for tax purposes, with the use of historical prices allowed only in certain cross-border cases and subject to GAAR;
• New exit tax rules required as part of the EU Anti-Tax Avoidance Directive (ATAD) that include a 21% exit tax (standard corporate rate) on the value of assets (with adjustments) when leaving the Slovak Republic, which may be paid in installments over five years;
• The introduction of controlled foreign companies (CFC) rules required as part of the ATAD, including that a foreign company will be considered a CFC if the Slovak taxpayer directly or indirectly holds itself, or with associated enterprises, more than 50% of the foreign company's capital, voting rights or rights to profit; and the actual corporate tax paid by the foreign company is less than 50% of the tax that would be due in the Slovak Republic.

The measures generally apply from 1 January 2018, although the CFC rules apply from 1 January 2019.