EXPOSE TO THE PROPOSAL OF THE STATE BUDGE T FOR 1998

This excerpt from the presentation of the draft of the state budget fo r 1998 by Ivan Pilip, the Czech minister of finance, contains a brief summary of the results of the state and municipal budgets in 1997 and forecasts a total deficit of roughly 0.9 % GDP. Regarding this result, Pilip stresses that continued commitment to a balanced budget is of t he utmost importance, given the expected performance of the economy in 1998. Pilip then outlines major indicators of the proposed state budg et for 1998. The total revenue and expenditures will reach 536,600 mil lion Czech crowns. In comparison with the 1997 state budget the revenu e will increase by 8 % in nominal terms, while expenditures will only rise by 4.9 % in nominal terms. The largest share of revenue will come from taxes (56.4 %) and payments of social security premia (39 %). No ntax revenue represents only some 4 % of the total. As far as the expa nditure side is concerned, the government's priorities consist of mili tary expenditures related to preparations for NATO membership, improve ment of the transport infrastructure, science, research and developmen t, and others.