Czech Supreme Administrative Court Rules Voluntary Sex Work Income is Taxable

Landmark Tax Ruling Issued

In a significant decision, the Czech Republic's Supreme Administrative Court (NSS) ruled on October 6, 2025, that income generated from voluntary sex work is subject to income tax. This judgment establishes a crucial legal precedent, clarifying that such earnings fall under the country's general tax framework, which mandates taxation for all income unless explicitly exempted by law. The ruling overturns a previous decision by the Ostrava Regional Court, which had initially sided with a woman arguing that income from activities deemed 'contrary to good morals' should not be taxed.

Distinction Between Voluntary and Criminal Activity

The Supreme Administrative Court emphasized a key distinction between voluntary prostitution and criminal activities. While prostitution in the Czech Republic exists in a legal grey area—neither explicitly legal nor illegal—the court clarified that voluntary sex work itself is not a criminal offense. Conversely, related criminal acts such as human trafficking, pimping, sexual coercion, and rape remain strictly prohibited and punishable. The court's decision underscored that the absence of explicit criminalization for voluntary sex work means its proceeds cannot be automatically excluded from taxation, rejecting the lower court's equation of voluntary prostitution with criminal activity.

Implications and International Context

This ruling means that individuals engaged in voluntary sex work in the Czech Republic are now legally obliged to declare their earnings and pay income tax, similar to other self-employed individuals. The case that led to this landmark decision involved a woman from whom the Financial Directorate had sought approximately CZK 1.8 million in back taxes over a two-year period. The NSS also addressed concerns regarding international agreements, stating that conventions like the 1951 New York Convention for the Suppression of the Traffic in Persons and of the Exploitation of the Prostitution of Others do not prevent signatory states from taxing income from consensual sex work. The court noted that other European countries, including Germany, Austria, and the Netherlands, already tax income from prostitution, aligning the Czech Republic with a broader international trend.

Future Outlook for Sex Work Regulation

While the ruling clarifies tax obligations, it does not legalize the sex industry or alter existing criminal laws. It primarily focuses on the fiscal aspect, separating tax liability from moral or ethical debates surrounding prostitution. The case will now return to the Regional Court, which must reconsider the matter in light of the Supreme Administrative Court's new legal interpretation. Estimates from the NGO Rozkoš bez rizika suggest that approximately 13,000 women work as sex workers in the country, many of whom are single mothers, indicating the significant scope of this new tax precedent.