Embattled PM backtracks on tax-reforms in the wake of election defeat
The ruling parties’ humiliating defeat in the weekend regional and first round of senate elections have clearly shaken the government’s resolve to effect painful reforms at any cost and left the prime minister fighting not just for the future of the centre-right government but his own place at the head of his party.
“We have to take into consideration that our coalition potential has shrunk. That is the reality and we need to take it into account. We have a razor-thin majority in the lower house and that only on condition that the Civic Democrats vote as one man. I have therefore proposed a change to the government’s tax package that I think may be acceptable not just for the Civic Democratic Party but for our coalition partners as well.“
According to information leaked to the press by sources inside the party the compromise rests in just one VAT bracket being raised by one percentage point rather than both. Moreover, the prime minister has also publicly expressed readiness to revise some steps in the area of social welfare benefits – in what is seen as a concession to disgruntled voters who expressed their opposition to the government’s harsh austerity measures in the strongest way possible – with an unprecedented show of support for the Communist Party.
However, it is fairly obvious that the government’s problems run deeper than finding the money to temper some of its reforms. The prime minister’s party is in a deep crisis with the regions calling not just for a change of leadership but a change of direction in party policy. Marek Šnajdr, one of the Civic Democratic Party rebels on Monday indicated big changes on the horizon for the strongest party in government which could have serious repercussions for the whole centre-right coalition.
The Civic Democratic Party’s national conference –which the embattled prime minister has just brought forward by a month-is to take place on the first weekend of November. If the government survives in office there is a strong likelihood it will continue under a different prime minister.