The deficit is expected to hit around €67 billion, up from €42.9 billion in 2024.
This is the first budget plan fully drawn up by the current government. The 2024 budget was largely developed by the former right-wing administration led by Mateusz Morawiecki of the Law and Justice party, leaving its successor with limited ability to make only minor adjustments.
The 2025 budget allocates 4.7% of GDP next year to defense—a record amount aimed at bolstering Poland’s security at a time of heightened geopolitical tensions and fears of Russian aggression.
At a press conference, Tusk said that defense spending will shoot up from the 2024 total of €39 billion, which already accounts for over 4% of the country’s GDP.
Tusk added: “We will build what is necessary not only for Poland's security but also for energy security."
“Poland is taking its role within NATO seriously," he continued. "This budget reflects our determination to ensure the safety of our nation and our allies."
Economic growth plus social welfare
The budget also reflects Tusk’s broader vision of economic growth and social welfare as the government projects a 3.1% GDP growth rate in 2024, accelerating to 3.9% in 2025.
In 2023, the Polish economy grew by just 0.2% due to “high inflation, tighter financing conditions, and an unwinding inventory cycle,” according to the World Bank. This came after robust 5.2% economic growth in 2022.
The prime minister said: "We are determined to ensure that economic growth and the good condition of the Polish economy are matched with material and financial security for the people, especially those most in need.
“Inflation is under control, economic growth is at a several-year record, real increases in the minimum wage, and the start of crucial investments, particularly in energy and rail infrastructure.”
Tusk added that these investments are vital for the country's long-term economic stability and growth.
Budget deficit of over €67bn expected
Finance Minister Andrzej Domański, announcing an expected budget deficit of over €67 billion in 2025, assured parliament that the ministry’s projections indicate strong fiscal performance in the coming years.
He said state budget revenues in 2025 will amount to €147 billion. He added that he expected “a clear increase” in VAT revenues of €11.6 billion, in CIT by over €2 billion, and excise revenues by more than €1.9 billion.
The budget has been drawn up amid a clearly accelerating Polish economy, with investment growth playing a critical role. "We see that the engines of economic growth are revving up, particularly with regard to investments," Domański said.
Inflation
The Finance Ministry announced on Wednesday that it expected inflation to fall in the coming years.
According to the Central Statistical Office, Poland's annual consumer price inflation reached 11.4% in 2023.
Meanwhile, year-on-year inflation in July 2024 stood at 4.2%, a 1.6% increase from June.
"In 2025, we predict that the average annual inflation rate will be 5%. In the following years, we expect a gradual decrease in inflation towards the NBP [central bank] target, reaching 3.1% in 2026 and 2.6% in 2027," the ministry said.
