Czechs consider implementing bank tax

Czech Social Democrats (CSSD) think the Czech Republic should join the list of Central Europe countries that has instituted bank taxes to help fill its coffers. The party is looking for ways to pay for its priorities, which include raising pensions by CZK 33bn. The party's chairman Jan Hamáček met yesterday with union leaders who are pushing for wage hikes in the public sphere, which would require new funds as well. Jan Votava of CSSD's budget committee told the daily Pravo that "Debate over a bank tax makes sense. Why not discuss something that works in lots of other countries and which would produce income for the state coffers," he said. The party is suggesting that larger banks would pay more than the smaller ones. Instead of paying 19 percent, the party's suggestion is that they would pay 25 percent. It's also considering instituting a "digital" tax, raising consumption taxes and increasing taxation on gambling. Financial experts warn that punitive bank taxes tend to backfire, leading to a decrease in lending and concern over the predictability of the business environment by potential new investors.