People are in for a difficult 2021, warned economist Lukas Kovanda. Speaking on Nova Television news, he said that he expects a further round of falling wages and layoffs. At the same time, consumers will notice potentially rapid price increases for basic items such as food and rent. Worst off will be people involved in the tourism industry as well as services such as restaurants, accommodations and culture. In those sectors, workers who experience only a cut in wages may end up being the lucky one. With the pandemic in full stride and vaccinations for the general public still months away, many of the companies in this sector will be forced to lay off workers just to avoid bankruptcy. Along with rising food prices, says Kovanda, water prices are likely to increase by at least 5 percent. The only likely relief will come from from the energy bills consumers have to pay, as electricity prices should fall by around 10 percent. To compensate for these hardships, the government pushed through changes to the tax system which will mean that more is left over from the gross wages of employees. While fuel taxes are set to fall by nearly CZK 1 per liter, taxes on tobacco will rise.
