The Czech Republic is submitting a revision of its medium-term Fiscal-Structural Plan in accordance with Article 15 of Regulation (EU) 2024/1263 of the European Parliament and of the Council, which reflects the formation of a new government and its updated economic and fiscal priorities. The review builds on the existing Fiscal-Structural Plan and updates the medium-term fiscal strategy, the macroeconomic scenario and the set of reforms and investments, with the aim of taking into account the government’s new policy priorities whilst maintaining compliance with the European Union’s fiscal framework.

The submitted plan reaffirms the Czech Republic’s commitment to the responsible management of public finances, maintaining the credibility of fiscal policy and ensuring the long-term sustainability of public debt. At the same time, it creates a framework for the implementation of the government’s economic strategy aimed at supporting economic growth, strengthening competitiveness, increasing the resilience of the economy and modernising the public sector. Fiscal policy will thus seek the balance between ensuring the stability of public finances and supporting investment and reforms with long-term benefits for the country’s economic and social development.

The macroeconomic scenario assumes continued economic growth driven primarily by domestic demand. The Czech economy is expected to grow at a rate of around 2 to 2.5% per year over the plan period, with inflation expected to remain close to the Czech National Bank’s inflation target. The labour market will remain relatively strong, but demographic changes will gradually come to the fore, leading to a slowdown in employment growth and an increase in the importance of labour productivity as the main source of economic growth. A key assumption of the scenario is also the gradual stabilisation of the external environment and the easing of some of the geopolitical and energy risks that have affected the European economy in recent years.

The government’s fiscal strategy is based on keeping the general government deficit below the 3% of GDP reference value and on gradually improving the structural position of public finances. The fiscal framework envisages a continuation of consolidation efforts whilst maintaining scope for investment supporting the country’s long-term economic growth, security and resilience. A key part of the strategy comprises measures aimed at increasing the efficiency of public spending, digitising public administration, curbing the informal economy and improving tax collection. As a result of these steps, public finances are expected to improve gradually over the plan period, and the public debt-to-GDP ratio should remain at a safe and sustainable level.

The plan includes a set of structural reforms and investments designed to support the long-term growth potential of the Czech economy and its ability to respond to technological, demographic and geopolitical changes. The government’s priority is to strengthen energy security and accelerate the modernisation of energy infrastructure, support the construction of affordable housing, develop transport and digital infrastructure, and create conditions for higher private investment. An important part of the reform agenda is also improving the quality of education, supporting science, research and innovation, modernising the labour market and increasing its flexibility. At the same time, reforms aimed at the digitalisation of public administration, the simplification of administrative processes and the more efficient functioning of the state will continue.

Ongoing demographic changes and the associated demands on public finances also present a significant challenge. The government therefore intends to continue with measures supporting the accessibility of healthcare and the efficient functioning of public services. The aim is to ensure that economic growth and the modernisation of the economy are accompanied by adequate social cohesion and the resilience of public institutions.

The revision of the plan was prepared in cooperation with the relevant ministries and other public administration bodies. In accordance with Article 11 of Regulation (EU) 2024/1263, relevant stakeholders, including the social partners, were also involved in the preparation process. A roundtable on reform and investment priorities was held on 6 May 2026, attended by representatives of employers, trade unions, experts and other stakeholders. The results of this consultation contributed to the final form of the submitted revision of the plan.

The proposed revision of the Fiscal-Structural Plan creates a framework for the stable development of public finances in the coming years and, at the same time, enables the implementation of the government’s priorities whilst respecting European fiscal rules, strengthening the competitiveness of the Czech economy and maintaining the medium-term sustainability of public finances.