The lower house of Parliament is expected to approve a government tax
package at its session starting on Tuesday. It includes a proposal to raise
taxes on alcohol and tobacco products, and an increase in parental
The basic parental allowance could rise from 80,000 crowns to 300,000 crowns. MPs are also due to start discuss the draft state budget for 2020, which counts on a 40 billion crown deficit.
In the initial round, MPs will approve the budget’s basic parameters, i.e. revenue, expenditure and deficit. MPs have tabled dozens of amendments to the tax package, only some of which the Committee on Budgets has supported thus far.
On Friday, Prime Minister Andrei Babiš (ANO) and Communist party leader Vojtěch Filip agreed to allocate an additional 4.9 billion crowns for the health sector. Originally, 334 billion crowns was earmarked for the sector.
Communist Party leader Vojtěch Filip announced on Friday that his deputies
will likely support the 2020 state budget proposal presented by the finance
The government of Prime Minister Andrej Babiš (ANO) in mid-September proposed a 2020 budget with a deficit of 40 billion crowns, the same as planned for this year.
Filip’s announcement came following a meeting with Mr Babiš and Minister of Finance Alena Schillerová (ANO). The minority coalition government with the Social Democrat relies on Communist tolerance.
The Communists have used their role as kingmaker several times to win major concessions. ANO was obliged to support their proposal to tax compensation awarded churches in lieu of property seized by the former regime that could not be returned in restitution.
Prime Minister Andrej Babiš and Finance Minister Alena Schillerová are
due to discuss next year’s state budget with representatives of the
Communists on Friday, iDnes.cz reported. The party’s executive committee
will be holding an extraordinary meeting that day and the government
officials hope to persuade them to back a CZK 40 billion deficit when the
2020 budget is voted on.
Communist MP Miloslava Vostrá, who is chair of the lower house’s budget committee, said at the end of August that she would recommend her party leadership support the budget, despite the CZK 40 billion deficit. The party had previously demanded that the deficit not exceed CZK 30 billion.
Under an agreement, the Communists support the minority government of ANO and the Social Democrats on key votes.
President Miloš Zeman will sign into a law an extended bill on electronic
cash registers as soon as he receives it. Mr Zeman made the statement on
Sunday in an interview for the website Blesk.cz.
The amendment to the bill on cash registers, approved by MPs earlier this month, extends the duty to report sales electronically to professions that are not yet subject to it, including craftsmen, doctors, lawyers and taxi drivers.
The amendment will also allow small businesses with sales of up to 600,000 crowns to record sales in off-line mode using paper receipts. At the same time some services and goods, such as, catering, cleaning services or home care will move to the lowest 10% VAT rate.
Prime Minister Andrej Babiš introduced the EET in 2016, when he was the finance minister, to counter the grey economy and tax fraud.
Prime Minister Andrej Babiš’ cabinet approved the 2020 draft budget on Monday, just hours after trade union leaders and employers expressed support for it. The compromise proposal which respects a 40 billion crown deficit ceiling should see more money spent on pensions, social services, teachers’ wages, parental benefits as well as research, sport and investments.
The government on Monday approved the draft budget for 2020 with a
projected 40 million crown deficit.
The government session, attended by President Miloš Zeman, was preceded by a meeting of the tripartite at which trade unions and employers expressed support for the draft proposal, which counts on higher pensions, higher salaries for teachers, more money for social services and families with children and increased spending in the fields of research and investments.
President Zeman made it clear that he would sign the budget, once it is approved by the lower house of Parliament.
The state budget is even less prepared to deal with a period of recession
than it was ten years ago, according to a report by the Supreme Audit
The report is critical of growing mandatory expenditures and a strong dependence on tax revenues, noting that even a slight recession would bring an increase in the state deficit.
The office says that last year mandatory expenditures rose to 1069 billion crowns, amounting to 75 percent of the state budget. The budget proposal for 2020 counts on a 40 billion crown deficit.
The lower house has approved a bill extending the law on electronic cash
registers, in other words a duty to report sales electronically, to a
category of firms that are not yet subject to it, among others to
craftsmen, doctors, lawyers, hairdressers and taxi drivers.
The amendment will allow small businesses with sales of up to 600,000 crowns to record sales in off-line mode using paper receipts. At the same time some services and goods, such as, catering, cleaning services or home care will move to the lowest 10% VAT rate.
Opposition parties, which have criticized the law as a bureaucratic burden on entrepreneurs are preparing to file a complaint against it at the Constitutional Court.
The law on electronic cash registers was introduced in 2016 to counter the grey economy and tax fraud. Prime Minister Babiš claims it has brought results and increased state revenues.