In 2023, the Czech Government plans to focus particularly on consolidating public finances and gradually reducing the large budget deficits that have accumulated in recent years. So far, the Government's attention was largely devoted to addressing the refugee and energy crises related to the war in Ukraine, as well as the EU Council Presidency. Consequently, the Government did not have time to tackle necessary reforms. It is therefore expected that in 2023, the governing coalition will significantly reform the tax system and, despite pre-election promises, increase certain taxes. The main part of the discussion on the new tax package is expected to take place between May and October 2023. At the same time, the Government will have to make significant cuts in public spending. Another of the Government's main priorities is to present a proposal for pension reform. Although according to the original plan this was supposed to happen already in February this year, the Minister of Labour and Social Affairs is still delaying the presentation of the draft and it is questionable whether he will succeed in what all his predecessors failed to do. Legislators will therefore have their hands full in 2023, but at the same time we can expect heated discussions with the opposition in the Chamber of Deputies, which will significantly complicate the approval of fundamental changes.

>> Read full report by Grayling covering eight CEE countries.