Prague-Czech government budget dispute

A political dispute has developed between the Czech national government and Prague city officials regarding the management and allocation of municipal funds.

Initially, Finance Minister Alena Schillerová criticized Prague for holding over 200 billion CZK in savings, suggesting these funds could mitigate a projected 389 billion CZK national budget deficit. Prague representatives, including SPOLU coalition candidate Tomáš Portlík, rejected this, labeling the stance “audacious” and arguing that the funds are earmarked for critical infrastructure projects, such as Metro D and inner city ring roads, which are expected to exceed 250 billion CZK.

The conflict expanded to include concerns over transport funding and taxation. Prague officials warned that proposed VAT law changes could impose an additional 21% tax on transport operators, potentially increasing ticket prices and costing six billion CZK annually. The city also protested the potential loss of contributions from the State Fund for Transport Infrastructure (SFDI) for local projects.

While the national government indicated that the state budget would not include planned increases for public transport discounts for seniors and students by 2027, it did propose increasing the SFDI budget by approximately 13 billion CZK to support highway, railway, and waterway modernization.