Tuesday, 2 June 2026
The Czech state budget recorded a deficit of CZK 170.2 billion at the end of May 2026, widening from CZK 106.1 billion in April, according to data released by the Ministry of Finance of the Czech Republic.
Although the deficit deepened during May, the result remained broadly in line with the same period last year, when the budget posted a shortfall of CZK 170.5 billion. The ministry noted that May traditionally brings a deterioration in the budget balance due to the timing of tax collections and several large expenditure items.
Total state revenues increased by 5.7 percent year-on-year to CZK 818.4 billion, supported by stronger tax collection and higher inflows from European Union funds. At the same time, expenditures rose by 4.7 percent to CZK 988.6 billion.
Finance Minister Alena Schillerová said the May result reflected seasonal fluctuations in public finances, as quarterly tax revenues are not collected during the month while significant payments, including advances for regional education, are concentrated within the period.
The minister also highlighted increased investment activity by the state. Capital expenditure rose by 24.8 percent year-on-year to CZK 76.7 billion, with funding directed primarily towards transport infrastructure projects through the State Fund for Transport Infrastructure and defence modernisation programmes.
On the revenue side, corporate income tax delivered one of the strongest performances, increasing by 13.1 percent year-on-year to CZK 54.9 billion. Personal income tax revenues reached CZK 72.8 billion, up 8.5 percent, reflecting continued wage growth across the economy.
Social security contributions generated CZK 351.3 billion for the budget, a 6.5 percent increase compared with the same period last year. The growth was supported by rising salaries and changes to the minimum assessment base for self-employed workers.
Value-added tax revenues increased by 4.4 percent to CZK 169.8 billion, while excise tax collection rose 3.2 percent to CZK 67 billion. Revenue from excise duties on mineral oils grew by 7.1 percent to CZK 33.6 billion.
Social benefits remained the largest expenditure category, reaching CZK 401 billion, an increase of 3.8 percent year-on-year. Pension payments accounted for CZK 309 billion of this total. Spending on unemployment benefits rose particularly sharply, increasing by 39.6 percent to CZK 8.7 billion following changes to support payments during the initial months of unemployment.
Analysts cautioned that achieving the government’s planned full-year budget deficit of CZK 310 billion may prove challenging. Factors weighing on public finances include lower excise tax revenues following the reduction of diesel taxation, increased expenditure on energy support measures and higher public-sector wage costs.
Economists also pointed to external risks, including weaker-than-expected economic growth and the potential impact of continued geopolitical tensions on the Czech economy.
The approved 2026 state budget projects revenues of CZK 2.118 trillion and expenditures of CZK 2.428 trillion, resulting in a planned deficit of CZK 310 billion. In 2025, the Czech Republic closed the year with a budget deficit of CZK 290.7 billion.
Source: CTK
