Prague Tells the Government to Leave Its Savings Alone. The Transport Minister Says He Is Not Prague's Minister

Prague's councillors have passed a resolution asking the government to find a way for the city and the regions to avoid paying transport operators 21 percent more in VAT for public transport, and objecting to the state transport infrastructure fund, SFDI, contributing nothing at all to repairs of Prague's and the regions' roads. Zdopravy.cz reports that the resolution was proposed by Adam Scheinherr, who leads the opposition Praha Sobě group on the council.

Scheinherr was explicit about what prompted it.

I was responding to attacks by members of the government who want to take from Prague the money it has saved for the major strategic projects, metro D and the Městský okruh.

— Adam Scheinherr, chair of Praha Sobě

Six billion a year, from an amendment nobody voted against

The tax change at issue is the threatened introduction of VAT for the bodies that order transport services. It would land on the compensation payments the city makes to its operators, the Dopravní podnik above all. Scheinherr's figure is that taxing those compensations would raise costs by up to six billion crowns a year, and the councillors' stated fear is the obvious one: higher fares and less service.

The change follows from an amendment approved in 2024, for which, as Zdopravy.cz notes, MPs from across all parties voted. Prague's councillors passed a similar resolution rejecting the VAT extension in April, so this is the second time of asking.

The second half of the resolution concerns roads rather than taxes. SFDI is to stop co-financing repairs and reconstructions of significant roads — a withdrawal that regions not led by the governing ANO movement have objected to alongside Prague. The fund's past contributions in the city include the reconstruction of the Barrandov bridge.

The argument about who pays for a capital city's infrastructure

The resolution's broader claim is about the shape of the system rather than any one line item. It argues that financing large capacity roads and new metro lines entirely from the capital's own budget is unusual among European metropolises, and that within the Czech Republic it is unusual too: Prague funds its own class I capacity roads, while in other regional capitals those sit with Ředitelství silnic a dálnic.

To that the document adds the constraint that makes saving unavoidable. The statutory debt ceiling for self-governments significantly limits their ability to finance large construction through borrowing, which pushes them towards accumulating their own funds instead. Municipalities and regions, the resolution says, have minimal tax and revenue autonomy by European standards and depend primarily on state policy for their income.

That constraint is what turns the finance ministry's argument against the city. Alena Schillerová, the finance minister, has long argued that Prague and the regions hold high balances that ought to be spent on road repairs and new infrastructure. In Prague's case the figure is over 200 billion crowns — money the city says is already earmarked for completing metro D and the Městský okruh.

"I am not the minister for Prague"

Ivan Bednárik, the transport minister, is under separate criticism from Prague and the Central Bohemian Region. Their transport councillors say he gives insufficient priority to the large transport projects in and around the capital, whose preparation is therefore at risk of being wound down. The ministry is described as lukewarm towards the new railway tunnels under Prague known as Metropolitní expres Spodem — also ŽUP, or Nové spojení II — and towards the Beroun tunnel. Both are intended to relieve an overloaded railway network and speed up commuting for hundreds of thousands of people.

Bednárik told Zdopravy.cz on Friday where he stands.

I am not the minister for the Central Bohemian Region and for Prague. I am the minister for the whole Czech Republic, so I will always weigh up whether they need a motorway to the Karlovy Vary Region or what the roads look like anywhere else in the country. Let us be aware that this is the richest part of the Czech Republic, with the largest investments in infrastructure and the largest investors.

— Ivan Bednárik, Minister of Transport

His stated aim is to stop the countryside emptying out and to bring investors to regions with room for them. But he also named a price at which the metropolis could buy its way up the list. The transport ministry's central commission, which approves transport projects, treats projects where there is a co-financing agreement with municipalities far more efficiently, and Bednárik suggested the same route is open to larger self-governments.

If they come with an offer that, let us say, they are willing to co-finance 30 to 40 percent from their own budgets, then I will be much more inclined to prefer one priority over another.

— Ivan Bednárik, Minister of Transport

Read together, the two halves of the exchange describe one loop. The city is told to spend the savings it has accumulated because it cannot borrow; it is told the state will prioritise its projects if it puts 30 to 40 percent of them on its own budget; and it is simultaneously facing a tax change that its own estimate says would take six billion crowns a year out of the same budget. Which of those pressures gives first is a question about metro D and the Městský okruh, because that is where the 200 billion is pointed.