Government backs reduced VAT for high labour services

The government approved moves to cut Value Added Tax on some labour intensive services at its Monday meeting. The measure should shift a series of services, such as dining in restaurants, getting a hair cut and bike repairs, into the lower nine percent sales tax bracket from the current 19 percent. The broad plans have already been backed at EU level. The step, aimed at saving jobs during the current crisis, is estimated to cost the Czech budget between 3.0 billion and 6.0 billion crowns a year.