Unions Oppose Benefit Cuts: Středula Demands Overhaul of Czech Tax System

The head of the Czech-Moravian Confederation of Trade Unions, Josef Středula, has sharply criticised the drafting of the state budget, whose deficit the ruling parties have agreed to keep only slightly below the originally planned 389 billion crowns. According to him, the burden of plugging the budget hole is being shifted onto the sick and the unemployed rather than onto wealthier groups of society.

Dispute over benefits and sick pay

Středula said that a proposal to reinstate the so-called "waiting period" — under which the first days of sick leave go unpaid — has for now been rejected by the SPD and ANO factions, but unions do not consider the issue closed, since similar ideas have already appeared in some parties' programmes. He was especially critical of Labour Minister Aleš Juchelka's (ANO) proposal to cut unemployment benefits in the first months from 80% to 65% of a person's previous average income. Středula stressed that no agreement has been reached on this point, calling the idea itself "absolutely unacceptable," since people lose their jobs not through their own incompetence but because of problems in the automotive, metallurgy and other industries.

Sale of state enterprises and rising public debt

The union leader also spoke out against the possible sale of state assets to cover the budget deficit — including the Explosia company and a stake in Prague Airport. In his view, such one-off sales of strategic assets make little sense given the current security threats: "a one-off gain will run out eventually, just like a one-off expense." Středula pointed out that a growing deficit only increases public debt, which future generations will have to repay. He argued it would be far more useful to discuss how to boost economic growth and shield the country from potential inflation — for instance, stemming from tensions in the Strait of Hormuz or the war in Ukraine.

Call for tax reform

The unions' main complaint is that the government is looking for savings mainly at the expense of workers and consumers, without indexing the tax-free allowance. According to Středula, wages and pensions currently account for 87% of all state budget revenue, while taxes on entrepreneurs and high earners have actually been reduced in recent years. He called this an "enormous imbalance" in the tax burden and said that, at a meeting of the tripartite commission, unions demanded an immediate halt to such measures and the opening of a debate on the future shape of the Czech tax system. Středula did not propose specific rates, insisting only on the need for an honest overhaul of the entire system.

Source: novinky.cz