Czech Republic: Beer prices high, mood down

The Czech government has raised beer prices as part of an austerity package. But no government has been happy with this in the country with the highest beer consumption per capita in Europe.

Rising prices have been a big issue in Czech pubs for a long time. Many things are cheaper in Poland and now also in Germany. Inflation in the Czech Republic is still the highest in the EU.

But now the complaining is particularly loud because it’s about the Czech national drink. In a bar in Prague, a customer complains about the increase in the price of beer. The government simply doesn’t want Czechs to “meet in bars and have fun,” he believes – and predicts that any government that increases beer prices will fall.

Sales are falling significantly

Beer has become even more expensive since the beginning of January, especially in larger Czech cities. On average, half a liter often costs the equivalent of 20 cents more. This time not because of high energy prices, but because of the government. They raised the VAT rate on draft beer from ten to 21 percent.

Some innkeepers are still refraining from selling the beer at a higher price and are expecting less profit. But most people go along with it – and find that there is “really bad feedback,” as one landlady reports. As a result, their sales fell by around 20 percent.

The debt should be reduced

The higher beer price is the result of a large savings package. The conservative-liberal coalition wants to reduce the Czech state’s record debt; five very different parties had to come to an agreement.

Now some subsidies have been canceled and taxes have increased – for companies, but also partly on food or cigarettes. Drivers have also had to dig significantly deeper into their pockets since January: for motorway vignettes or fines.

But the main topic of heated debate is beer. The brewery and pub lobby is loud. Lubos Kastner from the Association of Small and Medium-Sized Enterprises, himself a pub owner, is hardly missing from any talk show at the moment. There he then talks about what role beer plays in the country’s overall reputation.

Beer made the Czech Republic famous and, according to tradition, the Czech village grew up around the pub, and only then did a church and houses appear. And he points to the social function of the pub in the Czech Republic – “it strengthens our cohesion and differentiates us from the rest of the world.”

A threat to cultural wealth?

The Saaz hop landscape in the Czech Republic was recently declared a world cultural heritage site. But now, of all times, the government is threatening the country’s cultural wealth, believes beer researcher Tomas Maier from the Technical University in Prague – through the highest increase in beer prices to date. This is particularly “fatal” for many villages, because the price increase is likely to be another “nail in the coffin” for many pubs, he says.

Ten years ago there were 20,000 pubs in the Czech Republic; currently there are only half as many. Overall beer consumption has not yet fallen, but less and less beer is being drunk in pubs.

Those who have not yet had to close are complaining loudly about the government. In surveys, only 17 percent of Czechs are satisfied with their center-right coalition. That is still below the value that the traffic lights set in Germany – 19 Germans are satisfied with the coalition’s work.

The hour of the populists

Former Prime Minister Andrej Babis insults the Czech coalition as “anti-social and mendacious,” and the government is “the worst we’ve ever had in the Czech Republic. It makes everything more expensive. Of course, including beer.”

His increasingly populist party is gaining popularity among voters. She could win the European elections hands down.

The Czech government, like the German government, still has two years to turn the wheel. And perhaps the Czech pub culture will help her. Because this is where the steam is let off, rarely on the street.

In the Czech Republic, says a bar visitor, “people complain a lot about beer. But then they forget about it. And they will always drink beer.”