1. Alternative State Budget in the Czech Republic Prague, 20th November 2003 Hana Foltynova Vojtech Maca Jan Melichar Milan Scasny Society for Sustainable Living +420 251 080 402 Czech EFR Platform: www.czp.cuni.cz/ekoreformawww.czp.cuni.cz/ekoreforma

2. 2 Alternative State Budget – principals I. -introduction of a revenue-neutral reform (zero increase of the current taxation load) -2 time periods – 2004 and 2013 -alternative vs. „oficial“ state budget -only marginal deal with the non- budgetary funds

3. 3 Alternative State Budget – principals II. -no violation of the revenue-neutrality -public finances stability -radical, but gradual change of consumption behaviour -clear and credible image of the future development of the prices -long-term stability of the business environment

4. 4 Alternative State Budget – rules I. -Reduce labour-related costs -Promote environmental protection -Internalise external costs -Increase tax system efficiency, and fight tax evasions -Reduce environmentally and socially harmful subsidies -Develop human resources -Prepare for EU membership

5. 5 State Budget – obstacles -Long-term deficit trends and public debt increase -Persevering elements of inefficiency and the lack of co- ordination

6. 6 EU tax rates vs. Czech tax rates I. Product Min. rate EEC 92/82 nominal prices Min. rate in the Commission proposal COM(97)30 („Monti“) 1998- 2000-2002 COM2003 (Ecofin 20/3/2003) Rates in the Czech Rep. per 1000 l Difference between rates (EU-minimum and CzR) CZK/ 1000 l EUR/ 1000 l CZK/l,M J,kWh Motor fuels Unleaded petrol, per 1000 l 287417450 50 0 36010 840357-3-0,10 Leaded petrol, per 1000 l 337417450 50 0 42110 840357n.a. Diesel, per 1000 l245310343 39 3 3028 150268-34-1,03 LPG, per 1000 kg100141174 22 4 1252 85094-31-0,95 Kerosene, per 1000 l245310343 39 3 30210 840357551,66 Natural gas, per GJ 2,93,54,52,600-3-0,08

7. 7 EU tax rates vs. Czech tax rates II. Product Min. rate in the Commission proposal COM(97)30 („Monti“) 1998-2000-2002 COM2003 (Ecofin 20/3/2003) Rates in the Czech Rep. per 1000 l Difference between rates (EU-minimum and CzR) CZK/ 1000 l EUR/ 1000 l CZK/l,MJ,kWh Light heating oil, per 1000 l2123262100-21-0,64 Heavy heating oil, 1% sulphur/1000 kg 1823281500-15-0,46 Other heavy heating oils /1000 kg2228341500-15-0,46 Kerosene, per 1000 l7162500000,00 LPG, per 1000 kg10223400000,00 Natural gas, per GJ0.20.450.7 0.3 (non-bus.) 0,15 (busin.) 0000,01 Solid energy products (coal) per GJ 0.20.450.7 0.3 (non-bus.) 0,15 (busin.) 0000,01 Electricity, per MWh123 1,0 (non-bus.) 0,5 (indust) 0010,03

8. 8 Alternative State Budget – 2004 Budget compositionIndicatorProposal 2004 Alt. Proposal 2004 Alt. Proposal 2004 / Proposal 2004 11Taxes on incomes, profits and capital revenues179 800 1,00 12Taxes on domestic commodities and services217 600226 8221,04 121Value added tax132 586135 7391,02 + additional revenue from energy taxation under Law No. 353/2003 Sb. on Excise Duties814 1,00 122 Special taxes and fees on domestic commodities and services (previously excise duty item)77 16983 2381,08 + additional state budget revenue from energy taxation under Law No. 353/2003 Sb. on Excise Duties7 031 1,00 13Taxes and fees on selected commodities and services5 580 1,00 133Fees and collections in the area of environment1 280 1,00 16 Social security, contributions towards state employment policy, and public health insurance292 318275 2510,942 1TAX INCOMES TOTAL714 398706 5530,99 2NON-TAX INCOMES TOTAL25 202 1,00 3CAPITAL INCOMES TOTAL1 188 1,00 4SUBSIDIES RECEIVED13 292 1,00 STATE BUDGET INCOMES TOTAL754 081746 2360,99

9. 9 Alternative State Budget – 2013 Budget compositionIndicator2013Alt. Proposal 20132013 / Alt. Proposal 2013 11Taxes on incomes, profits and capital revenues303 768 1,00 12Taxes on domestic commodities and services301 170410 4891,36 121Value added tax224 001236 3201,05 122 Special taxes and fees on domestic commodities and services77 169174 1692,26 - electricity, natural gas and coal tax 50 000 - fuel tax 47 000 13 Taxes and fees on selected commodities and services2 1632 9131,35 133Fees and collections in the area of environment2 1632 9131,35 16 Social security, contribution towards state employment policy, and public health insurance493 865383 7960,78 1TAX INCOMES TOTAL1 133 236 1,00 2NON-TAX INCOMES TOTAL42 578 1,00 3CAPITAL INCOMES TOTAL2 007 1,00 4SUBSIDIES RECEIVED22 179 1,00 STATE BUDGET INCOMES TOTAL1 200 000 1,00

10. 10 Alternative State Budget – summary

11. 11 Alternative State Budget – structure of ecological taxes

12. 12 Alternative State Budget – summary Increase of the share of environmental taxes on the total tax revenue -from the expected 6.9% of the total state budget incomes (2.8% of the GDP, 65 CZK bln) in 2004 -to about 10.0% of the total public incomes (approx. 4.2% of the GDP, 195 CZK bln) in 2013

13. 13 PLATFORM on EFR www.czp.cuni.cz/ekoreformawww.czp.cuni.cz/ekoreforma database on projects+events database on enviro-related levies in the CR on-line library organisation of seminars, round-table (Sept.), conferences meet-point for researchers, students, NGO, information portal for everybody

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15. 15 Activities within the REC project -Leaflets -Study – alternative state budget -Seminar in Prague -Publications -Cooperation with the DUHA movement - leaflets -Czech-German initiative – a cycle of seminars -ETR group

16. 16 Thank you for your attention. Hana Foltýnová hana.foltynova@czp.cuni.cz +420 251 080 402 Czech EFR Platform: www.czp.cuni.cz/ekoreforma