The compound tax quota, the share of the gross domestic product taken up by taxes, will grow slightly to 35.7 percent next year, according to a report by the Czech News Agency. The quota includes customs duties and compulsory social and health insurance payments and is expected to reach 35.5 percent this year, up from 35 percent in 2012. After 2014, the figure is expected to fall slightly until it reaches 34 percent in 2016, according to Finance Ministry documents for the draft state budget for 2014. The Cabinet was scheduled to discuss the Finance Ministry proposals June 12. Total state revenues are set to reach 564 billion Kč next year.
Czech President Miloš Zeman has said the EU should set a corporate income tax of at least 25 percent and introduce a minimum wage in all countries. He put forward the view June 10 along with Bernadette Ségol, general secretary of the European Trade Union Confederation. Zeman and Ségol also spoke in favor of investments to improve employment levels after meeting at Prague Castle. However, Prime Minister Petr Nečas is against a unified corporate income tax rate. Ségol came to Prague as part of a tour of European Union members before an EU summit June 27-28 on the future of economic and monetary policy.
Government spending is set to increase by 15 billion Kč in 2014 and 10 billion Kč the year after, according to a Finance Ministry proposal. The government had been widely expected to increase spending and scale back austerity measures to promote growth ahead of planned elections in 2014. However, the budget deficit will remain within the 3 percent European Union recommended limit. According to projections, the Czech Republic's budget deficit will rise to 105 billion Kč next year and 110 billion Kč in 2015. The extra money is set to go to the agriculture, industry, education, interior and labor ministries.
Unemployment dropped to 7.5 percent in May, a fall of 0.2 percentage points compared with the figure for April, with seasonal work credited for the improvement in the figure. If the earlier methodology for calculating inflation had been used, the figure would have been 9.4 percent. Meanwhile, annual inflation fell to 1.3 percent in May, which is 0.3 percentage points below the forecast of the Czech National Bank. In April, the year-on-year inflation figure was 1.7 percent. The larger-than-expected fall in inflation was attributed to lower telecommunications and fuel prices, although food prices went up faster than expected.
The German-Czech Chamber of Industry and Commerce is holding a summer party to mark its 20th anniversary in the garden of the German Embassy in Prague. The event at the embassy on Vlašská 19 in Prague 1 starts at 5:30 pm, with the first entry at 5 p.m. Tickets for members and nonmembers can be ordered at Tschechien.ahk.de/termine/veranstaltungen/dtihk-sommerfest-2013/. On the same day at 6 p.m., the Nordic Chamber of Commerce is holding its Strawberry Party at Hergetova Cihelna, Cihelná 2b, Prague 1. Attractions will include an Abba tribute band. More information is available at Nordicchamber.cz.