In Business News: Czech Airlines gets a firm commitment for financial support from Korean Air and pushes ahead with restructuring plan, the ruling parties agree on the introduction of kurzarbeit to cushion the impact of the EU-Russia sanctions and give their approval to a finance ministry proposal to level a punitive tax on undeclared property, and, the average interest rate on mortgage loans drops to its lowest level since 2003. More
The Senate on Wednesday approved a draft bill which would introduce a third Value Added Tax rate. The 10-percent rate should apply to books, medicine and baby food as of January 2015. More
The Senate on Thursday approved a government-proposed bill on the introduction of a third 10 percent VAT rate on books, baby food and medicines as of January 2015. The basic VAT rate of 21 percent and the reduced rate of 15 percent will be maintained. The bill still needs to be signed into law by the president.
The draft budget for next year, approved this week by the Czech government, projects a deficit of some 2.3 percent of the country’s GDP. Government officials say the budget will allow for higher public investments and hikes in public sector salaries and pensions. But critics argue the budget is unambitious, and a missed opportunity to narrow the Czech public finance deficit at a time of an economic recovery. More
The lower house of Parliament on Wednesday also passed a draft bill establishing a third level of the value added tax. The 10-percent rate would apply to books, medicine and baby food as of January 2015. The Czech Republic currently has two VAT rates of 21 and 15 percent. The proposal was put forward mainly to benefit pensioners and families with children by lowering the prices of the selected goods.
The lower house of Parliament on Wednesday backed draft legislation introducing a third rate of the value added tax. If approved, the proposal, put forth by the government, would establish a 10-percent rate that would apply to books, medicine and baby food, as of January 2015. The Czech Republic currently has two VAT rates, 21 and 15 percent, respectively. The government believes a third, 10-percent rate would lower the prices of the selected goods, benefiting mainly families with children. Opposition leaders criticized the plan as hypocritical, and instead suggested the existing VAT rates should be lowered. A final vote on the proposal in the lower house is scheduled for later this week.
The price of cigarettes in the Czech Republic is due to rise by up to four crowns for a pack of 20. Wednesday’s approval of the price hike in the lower house followed a fall in the value of the crown that left the Czech Republic in contravention of a new EU guideline on excise duty. More
A cut in Value Added Tax to 10 percent for books, baby food, and drugs was approved by the government on Wednesday at its regular weekly meeting. The reduce rate of sales tax should come into force from the start of 2015. Babies’ nappies did not make it into the basket of tax reduced items because of fears that a reduction here would conflict with European rules. The introduction of a reduced rate of tax is one of the government’s flagship measures. The Cabinet also agreed to abolish charges for visits to doctors and hospitals with the exception of use of emergency services.
Former national police chief Petr Lessy is demanding compensation of CZK 1.2 million and a formal apology from the state for being prosecuted in 2012. He was removed as police president by the then minister of the interior after being charged with slander and abuse of office before a court threw out the prosecution last year. Mr. Lessy told Czech Radio on Saturday that the amount he was demanding corresponded to his legal fees and lost income.
The Finance Ministry has proposed introducing three VAT rates as of 2015, the ctk news agency reports citing ministry sources. This would include the current standard VAT at 21 percent, a reduced 15 percent VAT rate and a lower rate of 10 percent for selected products such as medicines, books and baby food. Contrary to expectations, the Finance Ministry has not included nappies in the lowest rate, on the argument that this is in violation of EU norms and Prague would be unlikely to get an exemption. The proposed draft bill also envisages a series of measures to fight tax evasion.