Gov't: Tax rates won't change this and next year

Prague, Feb 6 (CTK) - Tax rates will not change in the course of this year and next year, Prime Minister Petr Necas told journalists after a cabinet meeting Wednesday.

The government wants to maintain a stable business environment which is sensitive to changes in the area of taxes, he said.

"The government is well aware of the problems caused to the business sector at the end of last year as it did not know until Christmas what value added tax (VAT) rates would be in force this year," Necas said.

As of January 1 the reduced and standard rates of VAT increased by 1 percentage point to 15 and 21 percent. The hike was part of the tax package that was pushed through by the government coalition in the lower house of parliament just before Christmas. It was unknown for a long time, however, what would be the size of the rates.

If the proposal had not passed in parliament, a unified VAT rate of 17.5 percent would have been in force this year.

The government opted for stabilisation of the tax environment despite the fact that the step could possibly postpone the introduction of a single collection point. Necas said this would not happen and that the system would start operating as of January 1, 2015 as stipulated in the law.