Czech parliament approves austerity measures

AP News
Posted: Dec 19, 2012 11:21 AM

PRAGUE (AP) — The Czech Republic's lower house of parliament has approved unpopular austerity measures that had threatened to cause the downfall of the center-right coalition government.

In Wednesday's 102-88 vote, lawmakers overturned the upper house's veto to approve a 1 percent increase in the sales tax on retail goods and a 7 percent income tax increase for the highest earners.

The measures aim to bring the budget deficit below 3 percent of GDP and still have to be signed by President Vaclav Klaus.

The lower house first rejected the tax hikes in September after six rebel lawmakers from Prime Minister Petr Necas' conservative party voted against.

Necas resubmitted the measures to vote, linking them to a confidence vote. Three of the rebel lawmakers later resigned from parliament, making the measures' passage possible.