Business News

Tax rises in store to shrink public deficit

Czechs have been told to brace themselves for more tax rises in the future to get government overspending under control. Value Added Tax, real estate tax, and excise duties are all due to go up in January as part of already agreed measures to curb the budget deficit next year. Prime Minister Jan Fischer warned this week that another round of tax rises should be prepared next year. The Czech Republic was told at a meeting of European finance ministers this week to cut its public deficit as a proportion of GDP by one percentage point a year over the next three years. The government plans a deficit of around 5.3 percent for next year.

Fallout continues from Brussels competition swoop

A swoop by European Commission competition inspectors on local electricity giant ČEZ is still making waves a week after it was wrapped up. One Czech newspaper has said the firm was forewarned and had started to destroy incriminating documents. ČEZ bosses said they knew something was afoot, but only because of an article in a business magazine the day before the inspection started. And they deny workers destroyed evidence. The swoop did however disturb top level talks over a multi-billion crown deal between ČEZ and mining company Czech Coal. That bad timing has raised suspicions that a third energy group, Penta, might have had a hand in directing the Brussels competition squad towards Prague.

Hyundai plant experiences labour problems

Photo: CTK Labour unrest has broken at South Korean car marker Hyundai’s Czech plant in north Moravia. Around 400 workers staged a one-hour strike during the week to protest against excessive overtime working and what they describe as poor working conditions. Unions at the plant have warned that full scale strike preparations could be launched at the plant which employs around 2,000 workers unless talks with bosses resolve problems. Hyundai started production at the plant in November 2008. The biggest markets for the Czech produced cars are Germany, Britain, Russia and Poland.

Travel Service looks to Slovak expansion

The Czech Republic’s biggest charter airline Travel Service is looking to make big inroads into the neighbouring Slovak market. Travel Service, which failed in its bid to buy Czech Airlines this year, sees an opportunity from the current financial difficulties of Slovak charter carrier Seagle Air. Travel Service has already signed deals with Slovak and Austrian travel agents with the expansion into Slovakia lined up to take off next year.

Half of Czech households have computers

More than half of Czech households are now equipped with computers at home and 44 percent have high speed Internet access according to latest figures from the national statistics office. Home computer possession has jumped by six percentage points to 54 percent over the last year with fast Internet access up from 31 percent to 44 percent. An extremely high 40 percent of Czechs are hooked up to the Internet using Wi-Fi technology. But Internet shopping still has to make a big breakthrough with only 22 percent of users saying they regularly buy online.