Slovakia Approves Major Tax Hike and Savings Package to Cut Deficit

Slovakia's parliament has passed significant measures within a 2.7 billion euro fiscal package aimed at addressing one of the EU's largest budget deficits. The deficit-reduction effort, set forth by Finance Minister Ladislav Kamenicky earlier in September, strives to narrow Slovakia's GDP deficit to 4.3% by 2026, down from a current target of 4.7% this year.

Prime Minister Robert Fico's progressive government has launched its third package of reforms to sustain social spending, including energy price caps and additional pension payments for retirees. The government has attributed the nation's economic woes to prior administrations, following the EU's excessive-deficit procedure last year.

Approved measures include fewer public holidays, elevated taxes on sugary and salty foods, increased health insurance contributions, and modified tax brackets. Collectively, these changes are forecasted to contribute an extra 1.44 billion euros to the budget next year, with a total savings goal of 2.7 billion euros.

(With inputs from agencies.)