REFILE-UPDATE 3-Czech Communists may get share of power after snap election
* Breaking grid-lock, parliament votes to dissolve itself
* President expected to set early election for October
* Polls show Centre-left Social Democrats set to win
* Social Democrat chief says to seek support of Communists
By Jana Mlcochova and Robert Muller
PRAGUE, Aug 20 (Reuters) - The Czech parliament voted on Tuesday to dissolve itself, triggering an early election that could hand the Communist Party a share in power for the first time since a bloodless revolution ended the party's totalitarian rule two decades ago.
Opinion polls show that the centre-left Social Democrats will be the biggest party, but they will need support from other groups to govern and the leader of the party said he would talk to the Communists about forming a partnership.
In the eyes of many people in the country of 10 million people, the Communists are linked to 41 years of repression. But by being out of power for so long, the party has escaped the taint of sleaze that has tarnished the governments that took over from it.
Tuesday's vote to dissolve parliament came about after the previous government folded under charges from prosecutors that an aide to the prime minister, who was also his lover, had his wife put under surveillance.
The dissolution was supported by 140 members of the 200-seat lower house of parliament. The president, Milos Zeman, must now schedule an election, likely to be at the end of October.
Zeman's chief of staff Vratislav Mynar said late on Tuesday the president would meet party leaders on Friday to discuss the date of the election.
In an interview with Reuters before the dissolution vote, Social Democrat leader Bohuslav Sobotka said he hoped his party would form a minority government backed by other groups.
"It is definitely possible to expect negotiations with KSCM (the Communist Party,)" Sobotka said. "The Communists are in a number of town halls and in regional leaderships, and I do not see it causing problems."
But he said his party would not accommodate the Communists' programme or bring them into a governing coalition.
That was a nod to the toxic reputation the Communists still have for many Czechs, and to worries about back-tracking on market reforms in the Czech Republic, one of the more stable emerging markets that has attracted heavy foreign investment.
Sobotka signalled though that if his party forms a government, its economic policy would be more leftist than the previous centre-right coalition government, with plans to raise taxes for the biggest corporations and for high earners.
Before Vaclav Havel, who was nominated several times for the Nobel Peace Prize, led the 1989 Velvet Revolution to force it out, the Communist party held on to power through its feared secret police and with backing from Red Army tanks which put down the 1968 Prague Spring uprising.
Jiri Stransky, a dissident writer imprisoned under Communist rule and a friend of the late Havel's, said he believed today's Communists were dangerous populists.
"I am saddened that after nearly 24 years the country has ended this way, when we started out so amazingly," he said.
An opinion poll conducted this month by Czech pollster SANEP gave Sobotka's Social Democrats a 27.0 percent share of the vote, followed by the Communists on 16.7 percent, and the conservative TOP09 party with 13.1 percent.
Sobotka could try to win support for a government from other leftist parties, but they are likely to be so small that it will be tough to establish stable rule. That makes a partnership with the Communists the more likely scenario.
The party has apologised for Communist-era repression, and its domestic policies are not very far from those of the Social Democrats. They both want corporations to pay more tax, and to ramp up government investment.
But Communist lawmakers still call one another "comrade" and the party's deputy chairman has a portrait of Karl Marx in his office. In foreign policy, the Communists are more hardline. They want to withdraw from the NATO military alliance.
The Czech Republic has been in a state of political turmoil since June 13 when police, some wearing balaclavas, raided government offices.
Prime Minister Petr Necas resigned after prosecutors charged the head of his office, Jana Nagyova, with ordering intelligence agents to put Necas's wife under surveillance. Necas, who is divorcing his wife, later said Nagyova was his lover.
A caretaker government that took over from Necas failed to win parliament's support, leading to Tuesday's vote on dissolving parliament - the only way to break the stalemate.
Markets have been largely unfazed by the political turmoil because fiscal rigour under previous governments has given Prague the lowest borrowing costs among central European peers and a debt load which is half the European Union average.
But the gridlock has delayed the drafting of the 2014 budget and caused anxiety that, without firm political leadership, the economy will stumble just as it is starting to emerge from nearly two years of recession.
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