Shopping in the Czech Republic is still worthwhile for Germans. But the prices have been the same for years. And now the Czech government wants to significantly increase the tobacco tax.
Bui Thi Hue has been running her small shop in Petrovice, Czech Republic, on the border with Germany for ten years. The Vietnamese sells soft drinks, sweets and drugstore products on 15 square meters. Their best sellers are cigarettes. They are sorted by brand and lie on shelves illuminated with colored LEDs. 80 percent of their customers are German. They often come shopping in groups and take several poles with them. But business has been slowing down lately. “The cigarettes have become very expensive and fewer and fewer people come and buy them,” says Bui Thi Hue.
Due to higher inflation, prices in the Czech Republic are rising faster than in Germany. And now the government in Prague wants to raise the consumption tax on tobacco products. From 2024, the tax is to increase by ten percent and in the following years up to 2027 by five percent. The Czech government wants to reduce new debt in this way. Cigarette prices could match those in Germany.
Bui Thi Hue from Vietnam mainly has German customers in her small shop in Petrovice.
“Then we’ll just go to Poland”
Bui Thi Hue therefore does not only rely on cigarettes. She also owns a hair salon right next door. Here, too, mainly German customers come. The Enke family from neighboring Saxony has an appointment for their two sons to have their hair cut today, says mother Nicole. “The hairdresser is still worth it,” she says. “It’s considerably cheaper than in Germany. We pay around ten euros for the children here, in Germany we pay almost three times as much.”
Once a week the Enkes go to the Czech Republic to go shopping. They also buy their groceries here – and cigarettes, says Father Mario. “They’re still cheaper here. But if the prices are as high as in Germany, we’ll just have to go to Poland.”
Restaurants are also worried about guests
Petrovice lives from the German buyers. In the community of 1000 souls there are a number of shops similar to Bui Thi Hue’s. A kilometer-long bargain mile begins directly behind the border. Shops and small markets hang here like on a chain. All have a similar range: cigarettes, alcohol, garden gnomes and birdhouses. Mostly they are run by Vietnamese migrants.
And then there are the restaurants that are popular with German guests. When the German shoppers have finished their shopping, they often stop off at one of the restaurants and enjoy Bohemian specialties such as goulash with dumplings and a cold beer. But here, too, business is worse than it used to be because fewer people come to the village due to higher prices, says head waiter Petr Král. He works in the inn “U Jelena”, in German “Zum Hirsch”.
Germans are not only looking for low prices
His restaurant is established and visitors come despite the crisis, says Král. “But there are a lot of restaurants in town, and a lot of them just have their hands full trying to make ends meet. It’s getting harder and harder.” According to the head waiter, there are currently 15 restaurants in town. “I think the top ten will hold up,” is his prognosis.
Zuzana Hůlová knows the worries. She has been the mayor of Petrovice for a year. She used to work in gastronomy herself. Nevertheless, she is optimistic about the future and believes that guests from Germany will continue to come to shop. “It’s also about the different product range, about the different taste. That’s exactly how the Czech citizens go to Germany. It’s not always just about the price, but also about the experience, about the variety.” Many of the shops also focus more on service and support instead of just cheap offers.