PM Nečas: VAT might rise to 19 percent

16-07-2011

The Czech government might increase the VAT rate to 19 percent, while at the same time retaining a lower VAT rate for medicines, books and other printed materials including newspapers, Prime Minister Petr Nečas told the daily Mladá fronta Dnes on Saturday. The government is considering the move to make up for lower tax revenues that have been collected so far this year. The prime minister said the hike could be temporary until a balanced state budget is reached by 2016. While supported by Mr Nečas’ party, the Civic Democrats, as well as the coalition TOP 09 party, the junior coalition partner Public Affairs oppose the idea. The centre-right Czech government originally planned to introduce a single VAT rate of 17.5 percent to pay for an overhaul of the pension system.