Reichl Proposes Finding 400 Billion Crowns for the Budget Through Cuts and New Taxes

Jiří Reichl, a member of the Czech parliament and leader of the PRO party, claims he knows how to find 400 billion crowns to reduce the budget deficit. He outlined his plan in an interview with the TV channel XTV on September 13, and the video quickly spread across social media — though host Xaver Veselý dismissed the proposal as utopian.

Reichl belongs to the ruling coalition, which in theory could push such changes through. However, when asked on Tuesday morning exactly how he intends to achieve the announced cuts and whether he had discussed the plan with his coalition partners, the MP had not responded by the time of publication.

What Reichl Wants to Cut

On the spending side, the politician proposes a so-called "decimation" — a flat 5–10% cut to the budgets of all ministries and sectors, with the exception of the Ministry of Labour and Social Affairs, where he says such cuts are unworkable. The plan also includes scrapping part of military procurement spending, suspending certain national subsidy programs (Reichl refers to their recipients as "political and environmental NGOs"), and withdrawing from the ETS 1 and ETS 2 emissions trading systems. Together, according to the MP's calculations, these measures should save between 250 and 300 billion crowns.

New Taxes for Banks, Defence Firms and Tech Giants

On the revenue side, Reichl proposes introducing sector-specific taxes: 1% annually on assets for banks, and 1% of turnover for defence companies, along with higher taxation of major tech corporations — citing Google as a prime example. These measures, he says, would bring in an additional 150 billion crowns for the budget.

"Add it all up and you get roughly 400 billion, and it won't hit ordinary citizens. Regular people won't have to take a single crown out of their pockets," Reichl said.

Economists Skeptical of the Plan

Economist Štěpán Křeček questioned the claim that new sector taxes wouldn't affect ordinary citizens. "Banks, defence companies and digital corporations aren't charities. The moment a sector tax is imposed on them, they won't quietly absorb it — they'll immediately pass the bill on to their customers," he warned.

Former Finance Minister Miroslav Kalousek declined to assess Reichl's plan directly, but pointed to the PRO leader's voting record in the Chamber of Deputies. "As a government MP, he voted to increase mandatory spending by tens of billions, so there's nothing to be surprised about now. He had plenty of time to address the problem beforehand," Kalousek noted.

Analyst Boris Tomčiak added that the goal shouldn't be inventing new taxes to fill the budget, but finding the most efficient way to manage public finances. He pointed out that a significant share of state spending consists of mandatory payments, and that genuine reform would mean slowing their growth while managing individual ministries' spending more efficiently.

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Source: novinky.cz