Final Word from Monday, August 25, 2003

Jaroslav Plesl, who writes a very readable weekly column in Lidové noviny LN, called into question on Sat. our suggestion that Bohuslav Sobotka might have a longer life than the average finance minister. At the same time, Plesl made a suggestion of his own that, if adopted by Sobotka, would likely cause foreign investors to put a price on the young minister's head. Plesl said the exportation of profits by foreign investors is a problem the cabinet needs to resolve. He suggested that an extra tax might be appropriate. If Sobotka wanted to attack cross-border transfer pricing, management contracts and tax havens, he might do some good for the state budget. But placing an extra tax on repatriated profits or dividends would meet strong resistance. If foreign investors are earning too much money, making it easier to compete against them is the better solution.


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