Finance Minister in dispute with Civic Democrats over tax changes

Despite having voted for a package of reforms approved in the lower house on Tuesday, Finance Minister Miroslav Kalousek has now split with the government on how these reforms should be implemented. Mr. Kalousek proposes a further taxation of employees from 2009 by increasing tax-exemptions; however, the biggest party in the coalition, the Civic Democrats, wants to reduce personal income tax from 15% next year to 12.5% in 2009. The Civic Democrats have rejected Mr Kalousek's proposal, calling it a provocation and violation of the coalition agreement.

Author: Ruth Fraňková