Food prices could rise by a quarter, warns farmers leader

Food prices in the Czech Republic could increase by 25 percent in the near future, warns the head of the Czech Agricultural Chamber. Speaking on a TV debate programme, Jan Veleba said the increase was possible due to high demand for grain on world markets; grain prices have doubled in the last year. The Agricultural Chamber has proposed that value added tax should not increase from 5 to 9 percent in January, as planned. However, the minister of agriculture, Petr Gandalovic, says the VAT hike will not have a significant increase on the price of foodstuffs.

Meanwhile, the opposition Social Democrats say they will fight the rising of the lower VAT bracket from 5 to 9 percent. MP Michal Hasek said the party would table an amendment blocking the increase in a month's time; he said the move was not just a political gesture.

Author: Ian Willoughby