Last-minute tweaks put Babiš’s flagship project back in spotlight

Just days before the full launch of a new system linking cash registers in the Czech Republic to a central database, the scheme is back in the headlines. Its architect, the minister of finance, is proposing last-minute changes that he says will benefit small businesspeople. However, his opponents have slammed the move. Ian Willoughby reports.

Andrej Babiš, photo: Filip Jandourek

An electronic cash registry system under which Czech restaurants, shops and other businesses would provide information in real time to the country’s tax authority is the pet project of Andrej Babiš, the ANO chief and minister of finance.

After a one-month trial period, the first part of the scheme is due to go live this Thursday.

However, Mr. Babiš has now come out with changes to the system. One is that small businesspeople whose annual turnover reaches a quarter of a million crowns or less can opt out and make a flat tax payment instead.

Photo: Free Images

“We are proposing that the smallest be able to apply to make a flat tax payment. It’s a possibility. I don’t think any such entrepreneur will apply during the first phase of the scheme. And in the second phase it will be very few. If people apply and the tax authority finds that they take in a maximum of CZK 250,000 a year and they get approval, then they don’t have to take part. But it’s not a blanket exception.”

Mr. Babiš’s tweaks, which also concern online retailers, have been very coolly received by ANO’s coalition partners the Social Democrats. They say he promised no eleventh-hour changes.

Meanwhile, the minster can expect a stormy ride when the matter is debated in a lower house session starting Tuesday morning.

MPs are readying a number of proposals, either amending the system or doing away with it altogether.

Zbyněk Stanjura is the head of the deputies group of the opposition right-wing Civic Democrats, who have long been against the electronic cash registry system.

He says Mr. Babiš’s new proposal doesn’t hold water.

Zbyněk Stanjura, photo: Filip Jandourek

“It’s not logical. It’s even hypocritical. First the minister places loads of obligations on the smallest entrepreneurs and then he says in an understanding tone ‘We want to make things easier for the smallest; if they humbly apply, we will assess them – and if they don’t belong to the category of major thieves, then we’ll allow them not to be in the system.’ This doesn’t solve anything.”

Meanwhile, another conservative opposition party, TOP 09, are calling for the rollout of the system to be put back by two years. It should be an interesting week for Mr. Babiš’s flagship project.