10 June 2026, Updated on 10 July 2026 2027/2028 Budget and Medium-Term Expenditure Framework 2030/2031

The Federal Government's administrative deficit under the 2027 Budget amounts to €15.5 billion, representing an improvement of €2.8 billion compared with the 2026 Budget. Under the 2028 Budget, the net financing deficit is projected to decline by a further €2.4 billion to €13.2 billion.

Fiscal consolidation package and proactive policy measures

The fiscal consolidation package is broad-based. All population groups and economic stakeholders are contributing to the consolidation effort, ensuring that the burden is shared fairly.

• Companies, banks and state-affiliated enterprises make a significant contribution to fiscal consolidation, amounting to €0.8 billion in 2027 and €2.2 billion in 2028. This reflects the fact that they are also the main beneficiaries of the €2.0 billion reduction in non-wage labour costs. Key measures include the prolongation of the special contribution of banks (stability tax) for two years at the 2026 level (from 2030 onwards, the special contribution will expire and the bank levy will be reduced by 30%), the introduction of a progressive corporate income tax rate from 2028, a temporary restriction of the assets eligible for the investment-related profit allowance, additional measures to combat fraud and modernise gambling regulations, contributions to a comprehensive labour market package, and the abolition of the workplace allowance.
• Employees also contribute to the labour market package, amounting to €0.3 billion in 2027 and €0.5 billion in 2028. Measures include the reform of income-independent unemployment insurance contributions and the abolition of the teleworking allowance introduced during the COVID-19 pandemic.
• Pensioners have already contributed to fiscal consolidation under the 2025/2026 double budget. In addition to the demographic pressures driving pension expenditure upwards, pensioners benefited from pension adjustments that exceeded the underlying inflation rate in several years between 2019 and 2023. To safeguard the long-term sustainability of the pension system, pensions will therefore be adjusted more moderately in 2027 and 2028. Together with a reduction in expenditure on health resort services and rehabilitation treatments, the contribution of pensioners and other social and insurance benefits to fiscal consolidation amounts to €0.3 billion in 2027 and €0.6 billion in 2028.
• The social fairness of the fiscal consolidation package is reflected not only in the contribution made by companies, banks and state-affiliated enterprises, but also in measures amounting to €0.5 billion in 2027 and €0.6 billion in 2028 that primarily affect individuals with higher employment income. These include the extraordinary increase in the maximum social security contribution base, the introduction of taxation of the private use of zero-emission company cars, and the reduction in the flat-rate acquisition cost for existing properties for the purposes of the real estate capital gains tax.
• The 2025/2026 double budget already incorporated substantial administrative savings through expenditure reductions in the ministries, measures to contain personnel costs in the Federal Government, the Funding Taskforce and the State-Owned Enterprises Taskforce. This path towards a leaner public administration will continue. ÖBB-Infrastruktur AG will also contribute further to the consolidation effort through additional optimisation of its investment programme. Together with a range of other measures, including an optional advance taxation scheme for occupational pension funds and an increase in the excise duty on spirits, these measures contribute €0.1 billion to fiscal consolidation in 2027 and €0.6 billion in 2028.
• In the area of family benefits, the 2027/2028 double budget places greater emphasis on targeted in-kind benefits while adapting general cash benefits. The reform of the Family Bonus Plus from 2027 onwards, together with the suspension of the indexation of family benefits, including the child tax credit, in 2028, generates fiscal consolidation of €0.1 billion in 2027 and €0.3 billion in 2028.
• The 2027/2028 double budget also marks the beginning of the phase-out of environmentally harmful subsidies and introduces further reforms to subsidies and incentive schemes. Measures relating to climate-harmful subsidies and other support schemes therefore contribute not only €0.2 billion to fiscal consolidation in 2028 but also support the achievement of Austria's climate objectives.

The 2027/2028 double budget not only ensures the necessary stabilisation of Austria's public finances. Through the fiscal consolidation measures, it also creates the fiscal space needed to finance forward-looking policy initiatives in the areas of business competitiveness, labour market and social policy, and education policy. In total, €0.6 billion in 2027 and €2.5 billion in 2028 are allocated to proactive policy measures.

• A key measure to strengthen Austria as a business location is the reduction of the employer contribution rate to the Family Burdens Equalisation Fund (FBEF) by one percentage point from 2028 onwards, providing substantial relief for businesses. To support the agricultural sector, the Federal Government will reintroduce the agricultural diesel subsidy for 2026 and 2027. Together, these measures amount to €0.05 billion in 2027 and €2.0 billion in 2028. The Federal Government will continue to monitor economic developments and is considering additional temporary economic stimulus measures of up to €200.0 million.
• A total of €0.4 billion in 2027 and €0.3 billion in 2028 is allocated to labour market and social policy measures. The Federal Government will maintain active labour market policy at its current budgetary level while implementing measures to strengthen skills and qualifications and to support older workers and the long-term unemployed. Further priorities include long-term care and targeted measures to reduce child and youth poverty. Additional funding will also be provided to ensure access to analogue public services and promote digital inclusion, expand the Daily Physical Activity Programme, strengthen support for women, and broaden opportunities for educational advancement and lifelong learning.
• In education policy, proactive measures amounting to €0.1 billion in 2027 and €0.2 billion in 2028 are being implemented, building on the approach taken in the previous double budget. The Federal Government is investing in particular in early childhood education, including the introduction of a second compulsory free year of kindergarten, the expansion of all-day schooling, inclusive education, and the further development of school psychology services.