Czech coalition finally pushes through e-sales registration bill

By bne IntelliNews February 10, 2016

The lower house of the Czech parliament approved on February 10 a controversial bill to introduce a system of electronic registration of sales.

The governing coalition has been struggling to push through the legislation for several months, with the opposition having successfully obstructed previous parliamentary votes. The bill is part of efforts to fight tax evasion and boost budget revenue, powerful Finance Minister Andrej Babis claims. However, critics cite concerns over the effect on small businesses and the conflicts of interest of the billionaire leader of the Ano party.

The budget could reap an extra CZK18bn (€666mn) per year once the system is fully operational, the government claims. Babis says CZK2bn is already written into the 2016 budget. The opposition, however, insists the system would be time consuming and expensive, and would place unnecessary and unrealistic cost burdens on entrepreneurs, who would need to buy expensive e-cash registers. 

Mandatory electronic registration of sales would apply to accommodation and catering services, as well as wholesale and retail trade businesses. Up to 600,000 entrepreneurs, restaurant and hotel owners, artisans and service providers should be eventually part of the system. Hotels and restaurants will be the first to join the system, probably in November, CTK reports.

The opposition has also used the issue to press on one of the coalition government's most obvious weak points. They claim the system will hand a business advantage to the minister of finance, who owns Agrofert, the largest private employer in the country.

As owner of a supplier of a huge range of food to the service industry, on top of agricultural and chemicals products, the claim is that Babis will be privvy to the contract and pricing details of his competitors. Claims of Babis' conflicts of interest are a regular feature not only of opposition criticism but also from Ano's senior coalition partner the Social Democrat party (CSSD). However, the CSSD has supported Babis in this fight.

To take effect, the bill must be approved by the upper house of the parliament and signed by President Milos Zeman. The government coalition enjoys a majority in the Senate, while Zeman has previously said he supports the bill. The right wing opposition has threatened to file a constitutional complaint over the process of approving the bill as well as its content.

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