News

The head of the government Christian Democrats Miroslav Kalousek has stepped down as the head of parliament's budget committee due to a political row over his wife's finances. Mr Kalousek told a news conference that his wife, accused of failing to pay proper taxes in a family real estate deal, had done nothing illegal but that it was his responsibility to hold himself at least partially accountable as a public official. The Christian Democrats have been pressuring Prime Minister Stanislav Gross to step down amid a row over his personal finances that threatened to tear apart the coalition government. The step by Mr Kalousek is likely to increase the pressure on Mr Gross ahead of a congress of his Social Democrats at the end of the month.

The consultancy Ernst&Young has said that taxes paid by Czech companies are among the highest in Central and Eastern Europe. Malta is the only country among the ten new EU members where companies pay even more. The situation is expected to change in the foreseeable future. Since 2003, corporate taxes in the Czech Republic have fallen by 3 percentage points, and another cut can be expected soon. Czech companies pay some 28 percent of profit in taxes, but the real tax is lower owing to deductibles and tax reliefs. Real taxes stand at some 24 percent.

Two people were killed and three injured on Wednesday morning when a Prague streetcar derailed and collided with waiting pedestrians. Tram no. 22 derailed as it made a right turn at Prague's busy Charles Square, its rear wagon hitting those on foot. A 59-year-old man and a 64-year-old woman did not survive the accident. Two people are in hospital with serious injuries. The police are investigating the cause of the accident.

The Czech cabinet has reached a decision on a strategy for increasing public awareness on the EU constitution prior to a possible referendum. The campaign will be headed by the prime minister's office, though the Ministry for Foreign Affairs had expressed an interest. It is estimated that the campaign, which would begin this year and last into 2006, will cost almost 10 million US dollars. The campaign will be run mostly through the media, but it is unclear whether it will be strictly informative or in open support of the constitution treaty.