The special levy on retailers, to be discussed by parliament shortly, will increase food prices and reduce investments in stores, reckons Iness, a think tank. Retailers are likely to shift a part of the levy onto their employees, who will see slower wage growth.
The government plans to collect €150m annually on the levy, double the amount retailers paid in income tax last year. Kaufland admitted it will pass on the levy to consumers by raising prices. Retailer Coop Jednota says it might close some rural stores which barely break even now, without the levy.