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Czech President Vaclav Klaus has vetoed a bill submitted by parliament for the first time since his inauguration in March. Petr Hajek from the presidential office said on Tuesday that Mr Klaus refused to sign the bill on zoological gardens because it offered tax benefits to certain zoos. According to Mr Hajek, the bill introduces exceptional tax releases for a selected group of beneficial activities, thereby discriminating against other branches and potentially resulting in tax evasion. Since the law was largely supported by MPs in April, Mr Klaus' veto is expected to be overruled on May 27, when it will be re-discussed in parliament.

Economists have criticised plans unveiled by the government on Monday to reduce the budget deficit to prepare for adoption of the euro. Some economists said the measures would mean the country would not be able to meet the eurozone criterion of a budget deficit below three percent of GDP until after 2006, pushing back the earliest euro adoption date to 2009-2010. They said the basic outline of the plan was not far-reaching enough. The plan involves cuts in social benefits and tax changes to cut the fiscal gap from over six percent of GDP this year to four percent in 2006.

A new police study has claimed heroin gangs have begun moving their operations to bases outside the Czech Republic. In its latest annual report, the police's National Anti-Drug Centre said Balkan crime gangs responsible for much of Europe's heroin trafficking had been shifting warehouse operations to Poland and Slovakia. In addition, the report said Czechs were less likely to be hired as drug couriers by the Kosovo-Albanian, Croatian and Bulgarian gangs. The changes mark a shift away from the Czech Republic's long-time status as a trafficking route for heroin from the Balkans and Asia to neighbouring Germany and other parts of Western Europe.

A young Czech man who recently visited China has been admitted to Prague Bulovka hospital for fears he may have contracted the SARS disease. Doctors said the hospitalisation was more of a precautionary measure because the 30-year old man had fever but no other symptoms typical for SARS. Around 30 people so far have been taken to hospitals in the Czech Republic for suspcion of SARS but tests did not prove the disease in any of them. More than 500 people have died and thousands contracted the disease worldwide, with the biggest number of cases in China.