Two committees sank the government’s package, one passed. The Senate will approve it, Fiala believes

The Minister of Agriculture, Marek Výborný (KDU-ČSL), is of the same opinion, based on negotiations between the People’s Party and ODS senatorial factions with TOP 09, which have a majority in the Senate.

“I have the same impression of it as the prime minister,” said Výborný. According to him, the senators who represent the government coalition are aware of their responsibility and belonging to this coalition.

Four members voted for approval in the Senate Economic Committee on Wednesday, five abstained from voting. The committee did not even agree on possible adjustments. No one suggested rejection.

Finance Minister Zbyněk Stanjura (ODS) pleaded for the approval of the package without changes in the economic committee. Although, according to his words, he could imagine other changes, he described the adjustments promoted by the government as the result of a compromise between the five governing parties.

In the morning, the Senate Committee on Public Administration recommended in the package to adjust the share of local governments in the budgetary determination of taxes, which Michael Canov (SLK) unsuccessfully sought in the constitutional and legal committee. The Public Administration Committee also wants to maintain the exemption of gas intended for use in metallurgy from the natural gas tax, in order to ensure the competitiveness of glass and steel plants. According to Stanjura, this exemption represents 300 million crowns per year.

SLK senator Jiří Vosecký did not push through a similar proposal in the economic committee. Even Lumir Aschenbrenner (ODS) did not succeed with the adjustments to employee benefits.

The committee agreed on only three of the seven recommendations to the government proposed by its chairman, Miroslav Plevný (STAN). According to him, the Senate should invite her to consider changes to the taxation of employee benefits and the revision of the tax treatment of the meal allowance when preparing further amendments.

Ministries should also consider protecting energy-intensive industries in the form of tax breaks and potential remedial measures for contract workers.

In the constitutional and legal committee, senator Jitka Chalánková from the ODS and TOP 09 club did not prevail with the recommendation that the government should submit a new legislative amendment that would “take into account the role of the family in respecting the different roles of spouses” not only in the tax area. In this committee, five of the seven members present voted to approve the consolidation package without changes on Wednesday afternoon.

From the package, which changes to 65 laws, the government promises to consolidate public finances and reduce the structural deficit of the state budget. In the next two years, it is to be improved by approximately 150 billion crowns. Part of the money and savings is to be brought by the package, the rest is represented by cuts in the powers of the government.

The package introduces only two rates of value added tax, namely 12 and 21 percent. The lower rate will mainly include food including tap water, some services or perhaps draft beer will be moved to the higher rate. Books will be exempt from VAT. The corporate tax rate is to be increased from 19 to 21 percent. In the next two years, the consumption tax on alcohol will increase by ten percent, and in the following year by five percent.

The package reintroduces a levy on employee health insurance at 0.6 percent of income. It cancels some tax exemptions, such as the discount for school fees or for students. It limits the discount to a wife or husband without their own income, so that they will have to take care of a child up to three years of age.

The maximum amount of state support for building savings will be reduced from 2,000 to 1,000 crowns. The price of the annual highway stamp will increase from 1,500 to 2,300 crowns starting next March 1, and will increase according to inflation from 2025. The possibility of a one-day stamp will be newly introduced. Most of the changes are due to take effect from the beginning of next year.