Sociologist: The number of Czechs “on the edge” has increased significantly. And there is another big problem

“It’s a series of small measures that are very difficult to understand. Not even all the effects are calculated,” criticizes the government’s consolidation package, PAQ Research sociologist Daniel Prokop. According to him, the plan to restore state finances will affect all people, but those who have become poorer in recent years will be significantly worse off. In addition, according to him, there are more and more households that do not have savings.

Spotlight Aktuálně.cz – Daniel Prokop | Video: Jakub Zuzánek

“We are making a tax package that is equal for all parts of society, and I think that is a mistake. We have forgotten what we have done for the last three years and what are the effects of inflation,” Prokop warns, adding that the government’s consolidation package should help more poorer parts of the population, and that, according to him, is not happening in its current version.

According to the sociologist, the tax changes from 2020 have significantly helped high-income people, while on the other hand, households that are in a worse economic situation have been hit hard by inflation.

“Roughly a third of households do not generate savings – that means they spend their monthly income. And there are many more of them than two years ago,” explains Prokop, according to whom the government had a chance to “correct” the disproportion.

Daniel Prokop also sees a big problem in the fact that the package does not address important issues, such as the inequality between the taxation of employee work and self-employed work. However, he perceives certain positives in the area of consumption taxes, including that on alcohol, as well as changes in real estate taxation. “We have a high tax on labor and a small tax on property. The government will test the higher tax on real estate that it is not a taboo,” he says in an interview.

And he also comments on the fact that a number of households teetering on the edge of poverty do not have sufficient access to social benefits. It therefore welcomes the plan of the Ministry of Labor and Social Affairs to reform them. “Benefits such as child benefit or housing benefit are currently taken by around a quarter of people who are entitled to them. And it should be more automated so that you don’t have to declare so many things when you apply. Hopefully it could increase take-up, ” adds Prokop.