St. Vitus Cathedral in Prague

Czech Constitutional Court cancels Church restitutions tax

The Constitutional Court of the Czech Republic has cancelled legislation that would have taxed faith groups’ compensation for assets seized by the country’s Communist regime.

Driving the news

Under a 2012 law and subsequent agreements, 17 Christian and Jewish groups in the Czech Republic stand to receive up to $3.3 billion over the next thirty years.

That’s in compensation for buildings, land and works of art seized by the Communist dictatorship between 1948 and 1989.

The religious groups are also entitled to the return of those properties which can be returned.

The restitutions began to be paid out in 2013.

But earlier this year, the Communist party (KSCM) proposed levying a 19% income tax on the compensations from 2020.

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The KSCM law was voted through in the country’s Chamber of Deputies in April, with support from the ruling populist ANO movement, the left-wing Social Democrats CSSD and the far-right SPD party.

The Communists had told ANO Prime Minister Andrej Babis that the tax law was a condition for their support in Parliament.

The ANO-CSSD minority government needs that backing of the KSCM: the first time the Communists have had a taste of power since the regime ended in 1989.

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Announcing the court’s decision on Tuesday, judge Jaromir Jirsa said the magistrates agreed with a group of some 100 deputies and senators who complained that the tax law was unconstitutional.

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“The law runs counter to the constitution because its only goal was… a reduction of the financial compensation”, Jirsa said.

“The state entered into agreements and backed out of them afterwards”, he added.

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Why it matters

Prague archbishop Cardinal Dominik Duka also welcomed the court’s ruling.

“I’m glad that thirty years after the fall of Communism, it is not the Communists who determine the limits of the Church’s work”, Duka celebrated in a statement published on the Czech Church’s website.

“This is good news for everyone who cares about freedom and democracy”, the cardinal added.

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