The Council for Budget Responsibility (RRZ) has increased its general government deficit estimate for 2026 by €20 million when compared to its July forecast, due in particular to lower estimated compensation for energy subsidies from EU funds.
Unless the government adopts additional measures, the deficit estimate for this year is now expected to reach 4.4 percent of gross domestic product (GDP), or €6.3 billion. The deviation from the government's budget target stands at 0.3 percent of GDP (€409 million), indicating a medium risk of meeting the approved budget.
Compared with the government's latest estimate in its report on expected developments published on 15 August, RRZ's deficit forecast is almost identical, with a difference of only €43 million.
Although the overall deficit estimate has not changed significantly from July, the ranking of the two largest deviations from the budget has changed. Higher local government spending at 0.4 percent of GDP (€501 million) due to underestimated amounts in the budget ahead of this year's combined local and regional elections has overtaken a shortfall in taxes and levies particularly due to lower revenues from corporate income tax and value added tax.
Conversely, better fiscal performance of other general government entities, particularly transport companies and the state-run passenger rail carrier ZSSK, had a positive impact on the balance.
Source: TASR
