Sociální zabezpečení je klíčem k české daňové reformě
Social security is the key to Czech tax reform

Summary/Abstract: Social security contributions are the main Czech tax channel, without good reason. The Czech government made a resolution to reform these contributions and the income taxes. Two reform attempts of the Ministry of Finance met with resistance of the departmental and private interests. The biggest opponent of an efficient Czech tax reform is the political marketing, separated from tax economics. We have to explain to the marketeers that a radical reform of the social security contributions and income taxes brings not only the elimination of more tax distortions but also a considerable simplification of these public revenues and extensive savings of tax collection costs and corporate administrative burden of complying with taxes. The rationality of the social security contributions is contingent on the welfare regime used in the respective social protection branch. There are major controversies over the public health care financing where departmental and group interests have prevailed due to existence of seven health insurance funds. The suppression of these interests is a precondition for a major rationalization of the health insurance premiums and its integration into common social security contributions and single tax collection point. The reform of the supplementary social accident insurance administered "temporarily" by two private insurance companies (at the expense of the state) seems to be simpler. From the nature of the Czech social protection follows the need for the integration of employee contributions into the personal income tax and the elimination of double taxation of dividends within the corporate income tax reform.

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