The Czech Republic's state budget deficit widened to 176.6 billion crowns ($8.2 billion) in the first seven months of 2026, up 8.5 billion crowns year-on-year, though it remained the second-lowest July shortfall since 2020. Nearly 30 billion crowns from the European Union budget bolstered July revenues. Stripped of EU funds, the deficit stood at 212.4 billion crowns.
Budget revenues rose 5.4 percent to over 1.23 trillion crowns, while expenditures climbed by the same margin to exceed 1.4 trillion crowns. Tax collection grew just 1.1 percent nominally, but a 2.55 percentage-point reduction in the state's share of VAT and income tax revenues cost 19.3 billion crowns; adjusted for that change, tax receipts gained 7.5 percent. Social security contributions rose 6.3 percent and VAT collection increased 4.7 percent.
Capital spending surged 19.4 percent to 126.3 billion crowns, while debt servicing reached 55.6 billion crowns, up 5.4 percent. The government targets a full-year deficit of 310 billion crowns, though a rough estimate suggests it could reach 360 billion.