Czech 2025 budget seeks $10.2b deficit reduction

The Czech government has unveiled the draft budget for 2025, targeting a reduced deficit of CZK 230 billion ($10.2 billion), compared to the CZK 252 billion deficit projected for this year. This represents a substantial improvement from the record CZK 419.7 billion deficit in 2021.

Finance Minister Zbyněk Stanjura described the budget as pro-growth, highlighting a significant increase in investments despite ongoing fiscal consolidation efforts.

The proposed budget totals CZK 2,316.1 billion, including CZK 1,789.7 billion allocated to mandatory and quasi-mandatory expenses such as salaries and EU levies.

Notably, CZK 154.6 billion is earmarked for national investments, a record high, with an additional CZK 96.2 billion coming from EU funds.

Major budget allocations include CZK 951.5 billion for the Ministry of Labour and Social Affairs, CZK 271.6 billion for the Ministry of Education, CZK 154.3 billion for the Ministry of Defence, and CZK 101.2 billion for the Ministry of the Interior.

Investments in transport infrastructure will see a substantial increase to CZK 91.5 billion, reflecting a CZK 49.2 billion rise.

Revenue projections for 2025 estimate total receipts at CZK 2,086.1 billion, driven by increased collections from social security premiums (CZK 809.4 billion), VAT (CZK 414 billion), and corporate income tax (CZK 244.3 billion).

The budget also anticipates CZK 153.6 billion in EU funds. The draft budget aims to balance increased social and defence spending with efforts to consolidate public finances, maintaining key priorities such as education, defence, and infrastructure development.