The outline of the budget for 2026 is realistic. A large deficit means considerable debt emissions [OPINIA]
Sector deficit General Government (GG) In relation to GDP, in relation to the GDP, in 2026, 6.5 percent, i.e. slightly less than last (6.6 percent) and current (6.9 percent) of the year. Originally, the Ministry of Finance assumed that this year the GG sector deficit would amount to 5.5 percent. GDP, however, due to the smaller than the anticipated inflation, this year's budget revenues are to be about PLN 30 billion lower than planned.
Although the details of next year's budget are not yet known, it is to assume a clear increase in defense, health and housing expenses. On the income side, however, is expected, among others Increasing the CIT rate for the banking sector, as well as the increase in excise duty for alcohol products greater than originally than originally.
After the realization of this year's estimates of the state budget revenues, we believe that the outline of the budget for 2026 seems quite realistic. The ministry predicts that state income will increase next year by about 6.8 percent. Which is consistent with – in our opinion that makes sense – assumptions assuming GDP growth by 3.5 percent. and inflation at 3 %
A clear hole in public finances means the need to issue a significant amount of debt. Next year, public debt according to the EU methodology is expected to increase to 66.8 percent. GDP. In national terms, however, the state -owned public debt is to amount to 53.8 percent. GDP and will remain clear below the constitutional debt limit.
According to the Ministry's estimates, next year's net loan needs are to amount to as much as PLN 423 billion against PLN 300 billion this year. We believe that such a significant increase in needs is partly influenced by the national reconstruction plan in its loan part. Until now, as part of KPO, Polska has obtained EUR 13.5 billion from the Union from loans from the amount of EUR 34.5 billion in our country. So we think that the establishment of the full use of KPO funds may increase the loan needs of the state by up to PLN 70-80 billion.
Nevertheless, Poland will probably be forced to significantly issue bonds on the domestic market (details of the financing structure of loan needs at the moment are not yet known). In this light, we believe that the fiscal bonus included in the tax yields of debt papers will remain high. We estimate that the difference between the profitability of a 10-year tax bond and an analogous one at the maturity of SWAP may exceed 100 base points.
