In the first sign of disunity over the Slovak government's latest austerity package, Agriculture Minister Pavol Koncoš said he firmly opposed plans to raise the lower level of VAT, the Sme daily reported on May 25.
Last week, the reformist coalition government of Prime Minister Mikuláš Dzurinda announced a further package of measures aimed at eliminating macroeconomic imbalances and stabilising the currency. These included an increase in VAT, energy and housing price deregulation and the imposition of an import surcharge.
The government has not yet disclosed by how much it wants to raise VAT from the current six percent lower level. However, earlier this year, Deputy Prime Minister for Economy Ivan Mikloš proposed a rise to 10%.
"If the increase went to 10%, production costs at agricultural firms would rise by around 1.2 billion crowns in total," Sme quoted Koncoš, who is a member of the reformed communist Party of the Democratic Left (SDĽ), as saying.
"I would not propose increasing VAT, or at least I would propose excluding VAT on food to prevent an increase in food prices," Koncoš said.
Sme reported Koncoš as saying a lower level VAT hike from six to 10% would increase annual costs for food by 1,421 crowns per person.
31. May 1999 at 0:00 | From press reports of TASR and SITA