Debate on the Czech government’s austerity package entered its third day in the lower house of the parliament on Thursday, with opposition parties attacking the government over the proposed changes aimed at consolidating public finances.
Opposition parties ANO and SPD are accusing the cabinet of Petr Fiala (ODS) of damaging citizens and companies and breaking its promise not to raise taxes. Alena Schillerová, head of the ANO deputies’ group in the lower house, said the package was predominantly a significant hike in taxes that would further raise inflation.
The government argues it is high time to pull the handbrake on public finances because annual budgets have run unsustainably high deficits in recent years. According to its statement, the recovery package is expected to bring 94 billion Czech crowns (€3.8 billion) in savings to the state budget this year and 148 billion (€6 billion) after two years.
The package includes, for example, changes in VAT rates, where there will be only two of 12% and 21% instead of three rates, an increase in corporate taxes and a reduction in national subsidies.
The package also includes changes to the conditions for unemployment benefits, an increase in property tax and introducing a tax on e-cigarettes and other similar novel products.
Many experts, as well as the Czech Fiscal Council, an independent body that monitors fiscal responsibility, appreciate that the government has started to act, although they would like to see it go further.
The opposition, however, disagrees with the government’s approach.
The regular meeting of the lower house had already begun on Tuesday, but due to obstruction by the opposition deputies, the agenda was not even approved. This was not done until Thursday.
The opposition parties have tabled dozens of proposed amendments. However, the ruling coalition has a comfortable majority in both houses and has said it is resolved to push the package through, with only cosmetic changes to be considered. The meeting will continue on Friday.
(Ondřej Plevák | EURACTIV.cz)
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