Czech government approves CZK 5,000 benefit for families hit by inflation

The Czech government approved a CZK 5,000 one-off bonus per child under 18 for families with an annual gross income under CZK 1 million in 2021. The move still has to be approved by parliament and signed by the president. The opposition in the lower house has already announced it would call for amendments.

Families may start receiving the bonus as of August. Households that receive a regular child allowance should receive the benefit automatically. Foreigners may apply for the bonus, too, as long as they live and work in Czechia on a long-term basis. The aid is meant to mitigate the impact of growing prices on families.

According to the government documents, some 1.6 million children could receive the benefit. The total costs of the bonus may come to CZK 7.8 billion.

The government agreed to pay the CZK 5,000 bonus per child on April 27, but it started discussing the amendment last week. The debate was interrupted due to objections of some lawmakers and ministries.

A new version of the amendment was approved yesterday. The main differences concern a broader list of incomes that will be included in the CZK 1 million gross income and the procedure.

Under the new version, children who will be born between August and December 2022 will be eligible for the benefit, too, as well as those who will be under 18 by Aug. 1. The child must have a residence in the Czech Republic. Parents have to live with the child and support it to receive the support. Foster parents and partners of widows and widowers of the biological parents are eligible for the benefit.

Not only income from work and business will be taken into consideration for the CZK 1 million limit, but also revenues from rent and other revenues taxed in the Czech Republic.

Two million children under 18 live in the Czech Republic. Statistics show that 22 percent of households with children have a gross income below CZK 1 million. In April, 264,500 children received child allowance.

Experts on social issues criticize the one-off benefit. They recommended higher child and housing allowances. Some also consider it an attempt to bribe the voters before the local election in autumn.