Czech central budget posts first Jan-Sept deficit since 2015

• The central government budget is the main part of the overall public sector finances, which also include local and regional administrations.
• The 2019, central state deficit was approved by parliament with a 40 billion crown deficit.
• The government has mainly raised spending on pensions, wages, and investments.

The result, impacted by a jump in spending, lagging tax receipts and lower European Union fund inflows, is the biggest end-September deficit since 2014, and compares to a 16.8 billion crown surplus a year ago.

In August, the deficit stood at 15.4 billion crowns.

The central government budget is the main part of the overall public sector finances, which also include local and regional administrations, the health insurance system and various off-budget funds.

Despite continued economic growth, the government expects a swing to overall public sector deficits from 2020, after posting surpluses the last three years and plans for a surplus this year, as the government raises spending more than revenue.

The ministry forecasts the overall fiscal balance to show a 0.3pc/GDP surplus this year before falling a 0.2pc of GDP gap next year.

The 2019, central state deficit was approved by parliament with a 40 billion crown deficit.

Adjusted for funds from the EU, the budget would show a deficit of 19.0 billion crowns at the end of September, versus 4.8 billion crown gap a year ago.

In the January-September period, overall expenditure rose 11.6pc while income was up 7.7pc.

The government has mainly raised spending on pensions, wages, and investments.

Tax revenue rose 6.7pc year-on-year.

Value-added tax collection rose 4.7pc year-on-year, below a planned 6.8pc full-year rise.