Czech Republic passes emergency budget deficit expansion

0 Comment(s)Print E-mail Xinhua, March 26, 2020
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PRAGUE, March 25 (Xinhua) -- Czech President Milos Zeman on Wednesday signed into law an increase in the state's annual budget deficit, the president's office said in a press release.

The approved deficit will now rise from 40 billion Czech crowns (1.57 billion U.S. dollars) to 200 billion crowns (7.89 billion dollars) due to revenue losses and increased government spending resulting from the novel coronavirus pandemic.

Finance Minister Alena Schillerova assured the Chamber of Deputies on Tuesday during an emergency legislative session on the state budget that the state will be able to recoil from these losses.

"Right now is a good time to use the fiscal space that we have created in recent years with budgetary responsibility. The Czech economy is strong, the state of our public finances is good, the banking sector is extremely healthy, the budgets of local governments have unprecedented reserves, and health insurance companies are doing well," she said.

The main difference in the newly approved budget is an increase in state reserves for government discretionary spending which, in its previous amount, had already been spent on protective equipment for fighting the novel coronavirus pandemic, according to the Ministry of Finance.

The ministry expects tax revenues to decline by 55.7 billion crowns (2.19 billion dollars) due to restrictions on economic activity by the Czech Republic and its main trading partners.

As of Wednesday night, 1,654 COVID-19 cases have been confirmed in the country, with six deaths and 10 recoveries. The Ministry of Health issued a decree stating that a maximum of two people can assemble in public, with exceptions for members of one household, professionals at the same working place, or people at funerals. Enditem

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