Czech budget gap to rise next year on defence, finance minister says

Czech Republic's central government budget gap will rise next year, partly due to additional defence spending, Finance Minister Zbynek Stanjura told Czech Television.

Stanjura said the gap should rise to up to 280 billion crowns ($13.30 billion) from 241 billion planned this year, Stanjura said over the weekend.

The overall public sector fiscal gap should however remain around this year's 2.2% of gross domestic product, he said.

Next year's budget will be marked by a planned rise in defence spending to 2.3% of gross domestic product from this year's 2%, but also by financing of a new nuclear plant project and the end of a windfall tax on energy firms, mainly paid by utility CEZ CEZ in the past three years.

The current centre-right cabinet will prepare the 2026 budget ahead of the October 3-4 parliamentary election, but it will be modified by the new parliament.

The opposition ANO party which leads opinion polls has been sceptical on more defence spending but has pledged to raise wages and pensions.

($1 = 21.0550 Czech crowns)