23rd February 2015

Government approved the so called “financial constitution”

On its meeting on Monday 23rd February the government approved the act on fiscal responsibility, so called “financial constitution.” This act is originally drafted as the implementation of EU restrictions towards indebting of the member but in the Czech regulation it is extended and also includes the regulation of regions and municipalities. The key ratio is 55 % where the public debt in relation to GDP could not be higher than that otherwise the government would be forced to function on the basis of budgetary provisory and to cut the wages of state officials such as deputies, senators, judges etc. For the municipalities the ratio is less strict and is set to 60 %. In order for this act to be approved the government coalition needs to negotiate the constitutional majority within the Chamber of Deputies. These additional votes could be obtained from the deputies of Úsvit Movement that recently split themselves from their formal leader Tomio Okamura.

For more click here, here, here and here.

Members of the American Chamber of Commerce in the Czech Republic