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| President Klaus signs bill raising lower VAT rate to 14 pct |
| Praga, 22.11.2011 |
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| Czech President Vaclav Klaus today signed into law a bill under which the lower value added tax (VAT) rate grows to 14 percent in 2012 and the VAT rates unify at 17.5 percent as of 2013.
At present, the basic VAT rate stands at 20 percent and the lower rate at 10 percent.
The money raised through tax increases will be used for the pension reform.
The VAT hike will lead to an increase in prices of food, drugs, municipal public transport, health and social care, tickets to sport and cultural events, books and newspapers as well as water, heat and other things.
According to earlier calculations of the Finance Ministry, the changes will mostly affect pensioners and low-income families with children.
The ministry´s calculations, excluding potential compensation, show that the living costs of pensioners will grow by almost 2 percent, Kc313 a month, in 2012.
Low-income families will see a monthly rise of Kc263 or 1.87 percent in their costs.
Analysts also expect the lower VAT rate hike to increase household spending by hundreds of crowns a month.
Despite the leftist opposition's obstructions, the Chamber of Deputies passed the bill, returned to it by the Senate (upper house of parliament), early this month thanks to the government coalition deputies.
The Civic Democrats (ODS) and the TOP 09 party are currently considering another VAT change, effective as of 2013. The passed legislation reckons with the 17.5 percent VAT, while Prime Minister Petr Necas (ODS) and Finance Minister Miroslav Kalousek (TOP 09) are talking about a possible unification of VAT rates at 19 percent. The third coalition party, Public Affairs (VV), is, however, rejecting this option.
Autor: ČTK
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Address : Euro-Brew Ltd., Hlboká 22, 917 01 Trnava, Slovakia
Tel. : +421 33 53 418 53, Fax : +421 33 53 418 52, E-mail : info@eurobrew.sk |
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