Czech Republic Faces Potential Provisional Budget in 2026

The Czech Republic is on track to potentially start 2026 with a provisional budget, according to ANO party officials following their parliamentary election victory. The outgoing administration submitted a central state budget with a rising deficit, while ANO's promises of increased public spending foreshadow economic changes.

Prime Minister Petr Fiala's administration made strides to cut the fiscal gap below the EU's 3% GDP limit. However, the ruling parties were ousted by the ANO party, led by former Prime Minister Andrej Babis, who advocates for increased wages and tax cuts to spur economic growth.

Alena Schillerova, a senior official from ANO, indicated that forming a new government is paramount, despite the challenges in avoiding a provisional budget. The party, holding 80 of 200 seats, is in discussions to form a majority coalition, which may extend the budget approval timeline.

(With inputs from agencies.)