The State reaches record revenue and lowers the deficit to its lowest since 2007

BarcelonaThe State closed 2025 with the lowest public deficit since the outbreak of the financial crisis of 2008, thanks to a new historic record in tax collection, as reported this Tuesday by the Ministry of Finance.

Thus, Spanish Treasury collected a total of 325,356 million euros throughout 2025, 10.4% more than the previous year and the highest amount ever recorded. According to the Treasury, the price increases registered last year only explain 1.3 points of the 10.4% growth in public revenue.

In fact, the data align with the evolution of the Spanish economy during 2025 and the two immediately preceding years: Spain is the country that grows the most among the large economies in Europe, with a growth rate last year of 2.8% annually, 1.3 percentage points above the European Union average. Therefore, between the growth of economic activity and the consequent creation of more employment, public administrations collected more taxes last year.

The tax that has grown the most in collection is the income tax (IRPF), which has contributed 142,466 million euros to the public coffers, 10.1% more compared to 2024. This increase is explained, according to the government, by the "dynamism" of the labor market, where throughout last year a record number of employed people was also broken and unemployment was reduced.

The good performance of the economy was also reflected in the corporate tax, which increased by 8.1% in total revenue for the State to 42,266 million, while the collection of value-added tax (VAT) also increased significantly, to 99,532 million euros, 9.9% more than the previous year.

Less public deficit

The record revenue has had the side effect that the government has been able to improve public deficit figures. The deficit is the difference between the money collected and that spent by the State – if more is spent than is earned, it is called a deficit, if it is the other way around, a surplus – and it is measured as a percentage of gross domestic product (GDP, the indicator that measures the size of an economy). According to figures from the Ministry of Finance, Spain closed another year with a deficit, but of 2.18%, the lowest since 2007, the last year before the outbreak of the international financial crisis, when the fiscal year closed with a surplus.

Specifically, Spain's deficit in 2025 was 2.18% of GDP, 0.68 percentage points below the 2024 figure. If expenses due to the dana in the Valencian Country are taken into account – European regulations allow them to be excluded from the official deficit because it is an extraordinary event – the deficit rises slightly, to 2.39%. In both cases, it remains below the 2.5% agreed as an objective between Pedro Sánchez's executive and Brussels.

In principle, traditionally the Minister of Finance is responsible for publicly presenting the annual budget execution data, but María Jesús Montero's departure from the Spanish government and the appointment last week of Arcadi España from Valencia as the main person in charge of the executive's finances have led to the report being published without a formal ceremony, as Minister España has only been in office since last Friday. Despite this, the new minister has boasted about the figures: "It is not only important to reduce our deficit, but also the way in which we have achieved it. Spain is improving its fiscal balance without applying social cuts," he stated in a statement.

By autonomous communities, Catalonia was the third with the highest deficit (only surpassed by Murcia and the Valencian Country), at 0.54%, three tenths higher than announced two weeks ago by the Minister of Economy of the Generalitat, Alícia Romero. On average, the deficit of the regional governments was 0.3%. As for Social Security, it closed the 2025 fiscal year with a deficit of 0.4%, while local administrations did so with a surplus of 0.3%.