Millions for health, billions for the army. State finances under pressure

The Council of Ministers again adopted a draft budget act for 2026 after consultations at the Social Dialogue Council. The document will now go to the Sejm, and should be signed by the president by the end of January. Compared to the version from the end of August, the assumptions remain basically unchanged: state income is planned at PLN 647.2 billion, expenses for PLN 918.9 billion, and the deficit was set at PLN 271.7 billion.

Budget revenues

On the income side, VAT (approx. PLN 341.5 billion) and excise duty (PLN 103.3 billion) are to ensure the greatest revenues. The budget also assumes PLN 80.4 billion from CIT and PLN 32 billion from PIT, with a significant part of this tax goes to local governments. Additional revenues from the CIT increase for banks and excise duty for alcohol and tobacco products have been included.

Expenses include key public policies. The government indicates record amounts for defense – PLN 200 billion – and for health – PLN 248 billion (budget and non -budgetary funds together). PLN 61.7 billion is provided for the 800+ program, PLN 13.8 billion, “active parent” for 13 and 14. PLN 6 billion, and PLN 7 billion for a pension. They, along with other permanent transfers, determine the scale of loan needs.

Debt

The debt of the government and local government sector according to the EU methodology is to increase at the end of 2026 to 66.2 percent. GDP with 59.8 percent In 2025, the public debt counted according to the Polish definition is to reach 53.8 percent. GDP to 48.9 percent a year earlier. The Ministry of Finance maintains that the KPO loan part will increase net needs by 2.8 percent. GDP (approx. PLN 100 billion), although the government announced a reduction in this pool by approx. PLN 21.5 billion.

Social experts and partners warn that the rate of debt growth is high. With a sector deficit of 6 percent GDP Debt, according to the Polish methodology, is quickly approaching the 55 % threshold, and in the perspective also to the constitutional limit of 60 percent. It is noted that the project does not respond to the requirements of the excessive deficit procedure, assuming a reduction of up to 4.1 percent. GDP in 2026, while the planned level is 6.5 percent. GDP. It is indicated that not only defense expenses are charged to finance – a significant part of the increase in costs is generated by social benefits and rising debt service costs.

Employers’ organizations emphasize the need for clear budget priorities: directing assistance on the weakest, increasing expenditure efficiency and growth support. They postulate a review of social transfers and ranking programs in terms of effectiveness and impact on the economy. Without such a selection, maintaining a balance between spending ambitions and fiscal security will be more and more difficult.