The Czech state budget recorded the lowest half-year deficit in six years at mid-year, but it is still the sixth highest since the founding of the Czech Republic in 1993. Finance Minister Stanjura speaks of a positive development — driven by higher tax revenues and stable expenditure.
At the end of June 2025, the Czech state budget showed a deficit of 152.4 billion koruna. Adjusted for revenue and expenditure related to EU projects and financing mechanisms, the deficit stood at 150.8 billion koruna. Compared to the previous year, this represents an improvement of 26.2 billion koruna – thanks to increased revenues and moderate growth in expenditure.
“The budget deficit after the first half of the year is the lowest in six years. In June, the state budget even recorded a surplus of 18.2 billion koruna,” explained Finance Minister Zbyněk Stanjura. The main reason for the positive month was the payment of quarterly and half-yearly tax advances by companies, along with additional tax assessments for 2024.
By the end of June, state revenues had risen by 5.7 per cent year-on-year to a total of 1,011.5 billion koruna. Revenue from taxes and social security contributions performed well, increasing by almost nine per cent. Corporation and income tax revenue rose by over ten per cent. Value-added tax also increased significantly. For Stanjura, this is an encouraging sign: “This development shows that both the economy and households are doing better.”
Expenditure in detail
Government expenditure rose by 2.5 per cent compared to the same period last year, reaching around 1,163.9 billion koruna. This was mainly due to higher current expenditure (+2.3%), for example in education (+17.9 billion koruna), social transfers (+12.9 billion koruna), debt repayment (+4.9 billion koruna), personnel in state organisational units (+4.0 billion koruna), contributions to the EU (+2.5 billion koruna), and compensation payments to Czech Post for universal postal services (+2.3 billion koruna).
Decline in EU funds
While tax revenues increased significantly, funds from the EU and other financial mechanisms declined. Revenues from these sources were 23.6 per cent below the previous year’s figure (–18.8 billion koruna). A major reason for this is the irregular disbursement of funds from the Czech National Recovery Plan.
