Saturday, 16 December 2017

Czech budget may lose CZK 20 billion over planned tax cuts

ČTK |
19 June 2017

Prague, June 18 (CTK) - The lowering of taxes for 98 percent of employees, as proposed by Czech Social Democrats (CSSD) in their election manifesto, will cost roughly 20 billion crowns a year, CSSD election leader Lubomir Zaoralek told the commercial television station Prima today.

The loss in the state budget will be compensated by the taxation of banks, large companies with high profits and a change in the taxation of property, Zaoralek said.

He said the party's tax plans would not rise the state budget costs.

Social Democrat deputy chairman Jan Birke said the plan would eventually mean a "gap" reaching three billion crowns.

In its election manifesto passed on Saturday, the CSSD proposed progressive taxation and the cancellation of the super gross salary.

It wants to introduce progressive taxation of individuals and to lower taxes and increase the incomes of 98 percent of employees.

"This will make a loss of 20 billion," Zaoralek said.

On the other hand, the CSSD proposes progressive taxation of large companies with high profits of over 100 million crowns and it wants to impose 10 percent inheritance and gift taxes for the property over 50 million crowns and 15 percent tax for the property over 100 million crowns.

"The banks would mean plus 11 billion crowns, the income tax in the case of big companies some six billion and there is also the property tax. In essence, this is the real compensation," Zaoralek said.

Birke told Czech Television that according to experts' calculations, the Social Democrats' tax program would "basically mean the loss of three billion crowns."

"In the huge basket of the budget, this is a marginal figure," Birke said.

He said the Social Democrats wanted to tax the banks and large companies so that they did not transfer their profits to their mother companies abroad.

TOP 09 MEP Jiri Pospisil said the money for the Social Democrats plans were not in the budget.

Zaoralek argued that other parties like the Civic Democratic Party (ODS), TOP 09 and ANO had the same programmes, promising to lower the taxes by 50 to 100 billion crowns, due to which money for the health care and pensions would not be available.

As a result, health fees and tuition would have to be introduced, he added.

($1 = 23.490 crowns)

pv/dr

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