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Spotlight issue

4th October 2018 / Economic policy / Macroeconomic Indicators, Economic Growth


Czech manufacturing PMI at two-year low

The September manufacturing PMI declined further to 53.4, hitting the lowest level in the past two years. Still, this is in line with expectations that Czech industry growth will slow down towards 3% this year

1st October 2018 / Economic policy / Tax & Finance


IMF: International Corporate Tax Avoidance: A Review of the Channels, Magnitudes, and Blind Spots: A 1 percentage point larger tax rate differential reduces reported pre-tax profits of an affiliate by 1 percent.

According to a recent IMF working paper on tax avoidance, called International Corporate Tax Avoidance: A Review of the Channels, Magnitudes, and Blind Spots, a 1 percentage point larger tax rate differential reduces reported pre-tax profits of an affiliate by 1 percent. The authors believe that this estimate is larger than the consensus so far and the semi-elasticity has increased over time; a value of around 1.5 applies to the most recent years.

1st October 2018 / Good governance / Tax & Finance


Deloitte: Research and Development Deduction: The Fundamental Ruling

The Regional Court in Hradec Králové ruled in favour of the plaintiff (ENERGO CHOCEŇ, s.r.o.), revoking the contested ruling and referring the matter back to the Appellate Financial Directorate for further proceedings, Deloitte writes.

1st October 2018 / Competitiveness / Tax & Finance


International indirect tax guide

Indirect taxation is still evolving, and an arguable simple tax is growing in its complexity and application as a traditional goods and services model is replaced with digital content; virtual consumption and seamless international trade flows. But how can you stay ahead?

27th September 2018 / Competitiveness / Macroeconomic Indicators, Economic Growth


Economic Freedom of the World Index: Czech Republic ranks 30th, Scores Best for Freedom to Trade Internationally

The index published in Economic Freedom of the World measures the degree to which the policies and institutions of countries are supportive of economic freedom. In 2016, the latest year included in the analysis, Hong Kong and Singapore, as usual, occupy the top two positions. The next highest scoring nations are New Zealand, Switzerland, Ireland, United States, Georgia, Mauritius, United Kingdom, Australia, and Canada, the latter two tied for 10th spot. It is worth noting that the United States returned to the top 10 in 2016 after an absence of several years. Canada also returned to the top 10 after coming in 11th in 2015. The Czech Republic ranks 30th.

Strategic Directions for Czech Economic Policy

  1. 1) The home of value-added manufacturing
  2. 2) Prague-Brno-Ostrava Creative Triangle
  3. 3) Health Care as an export industry
  4. 4) Government as a competitive advantage

Advocacy Priorities for 2018-2020 
 
People 

1. Setting a predictable policy for economic immigration based on the goal of maintaining current levels of employment for Czech citizens and wage growth that corresponds to productivity growth.  

2. Establishing incentives for companies and individuals to provide the qualifications and skills necessary for the automation of production and service industries.  

3. Introducing machine and computer programming as a required language in elementary and high schools.  

4. Improving the Healthy Life Years of the workforce and overall population through better prevention programs, better diagnostics, and better treatment.  
 
Infrastructure 

1. Develop a plan for developing and maintaining an integrated rail, road and air commercial logistics systems.  

2. Integrate the Prague airport into the national commuter network.  

3. Increase digital infrastructure capacity throughout country. 

4. Develop a housing plan that will create more entry-level housing in Prague and Brno for purchase or rent.  
 
Technology 

1. Reform investment incentives to concentrate on product research, development and production.  

2. Establish policy objectives in the area of health, energy, transport, environment and other areas and use these objectives for allocating public research funds. 

3. Require major public procurements to use objective and measurable criteria for innovation. 

 

Read the document in English and Czech.

Policy pipeline

In Policy Pipeline policy developments in the Czech Republic and abroad are monitored to bring better understanding of current topics and trends.

Members of the American Chamber of Commerce in the Czech Republic