The government has approved a plan for far-reaching tax and spending reforms. The plan, which was unveiled in Prague on Tuesday, aims to slash taxes and public spending paving the way for a possible adoption of the single European currency as early as 2012. Reforms include the introduction of a flat 15 percent income tax rate, a rise in the reduced VAT rate from 5.0 percent to 9.0 percent and a cut in the basic VAT rate from the current 19.0 percent. A series of public spending cuts, mainly affecting social security payments and the health sector are expected to curb the government's overall budget. The reform plan will now have to be approved by the lower house of Parliament.
The entire board of directors of CzechInvest, a government agency promoting business and investment, has resigned in protest of last week's dismissal of the agency's general director Tomas Hruda. Trade and Industry Minister Martin Riman sacked Mr. Hruda last week citing poor management. The dismissed general director ascribed the decision to problematic personal relations with Mr. Riman. Since the news broke the vast majority of CzechInvest's 300 employees have threatened to resign.
One of the country's biggest Second World War heroes RAF pilot Antonin Spacek has died at the age of eighty-nine. Like other war veterans who flew with the RAF he met with a sad fate after his return to post-war Czechoslovakia. After the communist putsch in 1948 he attempted to flee the country with his family in order to escape communist persecution but only his British born wife and child got out. Antonin Spacek was sentenced to ten years in a show trial and sent to work in the uranium mines. After the fall of communism in 1989 he was rehabilitated and awarded the rank of major general. Antonin Spacek was chairman of the Czechoslovak Legionaries Union and in 2006 he received the highest state distinction - the Order of the White Lion.
The opposition Social Democrats have ruled out support for the reform package in its present form. Former finance minister Bohuslav Sobotka said that while some of the proposed reforms might win approval from the opposition they would have to be discussed independently. The reform package as a whole is unacceptable, Mr. Sobotka said.
According to the results of a survey conducted by the STEM polling agency 60 percent of Czechs have trouble making ends meet on their salary. A fifth of respondents said that family budgeting was difficult and often left them counting the days till pay day. 31 percent of respondents said they managed just fine on their income and a mere eight percent said they could afford a luxuries and had all they wanted.
The Constitutional Court has ruled that local town halls are fully entitled to ban prostitution in public places. The legal dispute arose when several town halls issued regulations banning prostitution in all public places and pushing it to the outskirts of town. The interior ministry questioned their right to set such a norm. The court ruling will now help other towns that are plagued by the problem. Many mayors have called on Czech MPs to set clear rules as regards "the oldest trade in the world". Although pimping is illegal in the Czech Republic prostitution is not and there have been calls for it to be legalized and brought under control -with taxes and regular medical check-ups.
The Christian Democratic Party leadership on Tuesday reiterated its backing for party leader and Deputy Prime Minister Jiri Cunek who is accused of corruption and is in trouble over recent offensive remarks made to a Czech tabloid newspaper. Last Friday Mr. Cunek suggested that non-Roma wishing to earn state subsidies like the Roma needed to "get a suntan and cause trouble" to get politicians' attention. The comments were immediately denounced by the prime minister and other members of government. President Klaus said on Tuesday they were "completely unacceptable" and appealed to politicians not to accept prejudices held "in no small part by the Czech public". Jiri Cunek has tried to defend himself, arguing that his words were taken out of context and saying that his words were not aimed against Romanies but against politicians. He apologized to any Romanies who felt insulted by them.
A female passenger in a vehicle was shot by police in a suburb of the east Moravian city of Ostrava on Monday and seriously injured. The incident was reported on the Internet server of commercial broadcaster TV Nova. The shooting reportedly took place during a pursuit of the vehicle in a residential area. The woman was taken into hospital shortly after 8 pm. Police have not released additional details.
The two former Social Democrat MPs who changed the balance of power in the lower house and enabled the centre right government to win a vote of confidence in January of this year say they have not been consulted about the reform package despite the fact that their votes will be crucial for its approval in Parliament. Michal Pohanka said he was expecting to be contacted about it since the governing coalition had promised to consult all significant government proposals with him in return for his vote of confidence. He said that the little he had learnt about the package from the press did not inspire him with confidence.
Industry Minister Martin Riman on Tuesday likewise sacked the head of the Czech Inspection Office Jiri Pekny. According to a ministry spokesman Mr. Pekny was sacked for poor management. The spokesman cited lack of coordination and inefficiency, saying that the office had made occasional random inspections without any clear goals and priorities. Jiri Pekny is to be replaced by Jana Prihodova, a former employee of the Inspection Office who served as deputy mayor of Prague 1 up until 2006.
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