HIGHLIGHTS-Czech leftist leader's comments in Reuters interview
PRAGUE Aug 20 (Reuters) - The following are selected comments from a Reuters interview with Bohuslav Sobotka, leader of the Czech Republic's Social Democrat party, who is front-runner to be the next prime minister.
For a story from the interview, click on
ON NEXT GOVERNMENT, TALKS WITH COMMUNISTS
"Our ambition is to get every third vote that will be cast. If we succeed in that we will seek (to form) a single-party government of the Social Democrats (CSSD).
"It is definitely possible to expect negotiations with KSCM (the Communist party). It can be only KSCM or it can be more parties (that will support a CSSD minority government).
"But I do not expect that we would form a coalition with the KSCM.
"The communists are in a number of town halls and in leadership of (several) regions and I do not see it causing problems.
"We are proponents of European integration and we are proponents of our membership in NATO. The Social Democrats do not intend to accommodate the programme of the Communist party in any way.
ON PENSION REFORM
"We do not support the second pension pillar (introduced by the previous government). We think it has no future.
"Immediately after the election we will start talks with the central bank about merging the funds and subsequently we will talk with the funds' representatives about the best way to wind up the second pillar.
"If the CSSD gets into power, one of the first tasks for the Finance Minister and the Labour Minister will be to prepare a proposal to end the second pillar.
ON ECONOMY, TAXES
"Frustrated voters need some resolution. This can be a newly elected government trusted by the public.
"The government will not scare people with across-the-board cuts.
"We aim to restructure spending to boost investments. We are looking at two main tools, the infrastructure fund and the housing fund, including using EU development funds as much as possible. We also aim to set up a fund aimed at environmental projects.
"Through these funds we would like to kick-start higher investments in roads and motorways, social housing, home insulations to cut energy costs, as well as flood barriers.
"We count on implementing a second corporate income tax rate for large companies that have a dominant monopoly position on the market. We mean telecoms and utilities in particular.
"It isn't clear yet what the rate will be, we are mulling 25-30 percent."
"We plan to return permanently to progressive taxation for high earners. We may tax the lottery and gambling more.
"We want to keep the public sector deficit below 3 percent of gross domestic product (GDP) unless the economy falls into a recession again.
"The Czech Republic should coordinate with Poland on euro adoption. It should achieve such a state of public finances that would not hamper euro adoption.
"I do not think it is possible to adopt the euro in the upcoming election term (4 years) but it is possible to prepare the Czech Republic for euro adoption during the term.
"If there was an agreement of all political parties, the government could set a date.
"I see a risk in the overall public debt because the next government will take over when the public debt will be around 48 percent of GDP, only 12 percentage points short of the maximum set by the Maastricht Treaty.
"The Czech Republic will have to be very cautious not to complicate its euro adoption in the mid term.
ON NEXT YEAR'S BUDGET
"We would like to avoid a provisional budget. I think the (election) dates of October 25. and 26. will make it possible to approve the budget by a new parliament by the end of the year.
"Our election program will include a pledge to propose changes to the Constitution that would reflect the newly-implemented direct presidential election so that we avoid conflicts between individual constitutional institutions while the parliamentary nature of the Czech Republic is preserved.
"My ambition is to make the Constitution more specific so that there are no doubts that there could be a threat of a shift towards some authoritative system of the government." (Reporting by Robert Mueller)
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