The 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.

More than ten years ago, in the midst of the Great Recession, the two main parties in Spain, the PSOE and the PP, agreed to a constitutional reform to accept and comply with the debt reduction demanded by Brussels from the most indebted countries. This led to the creation of a permanent constraint on public spending enshrined in the Spanish Constitution under the name of "budgetary stability," paving the way for Mariano Rajoy's (PP) government to later pass the so-called Budgetary Stability Law in 2012. All of this required public administrations to be very restrictive with spending.

A windfall of millions for the autonomous communities under the common regime. The Ministry of Finance has informed regional governments that next year they will receive record resources from the financing system, amounting to up to €157.731 billion (7% more than in 2025) in the form of advance payments. This figure is slightly higher than the one announced in the summer. Of this money, Catalonia will receive a record €30.207 billion, 6.9% more than in 2025, as reported by the Ministry of Finance this Monday, following the Fiscal and Financial Policy Council (CPFF). It is worth remembering that advance payments are the resources that the State transfers in advance to the autonomous communities and municipalities, depending on the administrations' tax revenue forecasts. These funds represent the bulk of the resources available to the regions for preparing their budgets and covering basic services, and are updated annually according to economic growth forecasts, but above all, tax revenue projections, which have performed well in recent years. To this amount must be added the positive settlement for 2024: €13.506 billion. This means that the central government anticipated lower tax revenue for the regions that year, but this did not materialize. Thus, the Treasury will transfer a total of €170.3 billion. Deficit target of 0.1%

However, the Treasury is not making any changes to the deficit target for the autonomous communities in 2026. The department headed by María Jesús Montero (PSOE) has confirmed that they will have a deficit target of 0.1% of GDP in 2026, 2027, and 2028. "That means a deficit for all three years," Montero said at a press conference. For Catalonia, this represents approximately €1 billion in additional spending leeway during this period, according to calculations by the Catalan government. Along with the deficit target, Montero also announced the debt target for the autonomous communities (set at 20% of GDP for 2026), as well as the spending rule limit, which for next year will rise to 3.5% (currently at 3.5%). The Minister of Economy and Finance, Alícia Romero, welcomed the upward revision of the spending rule limit, as it is a key element of the new European fiscal rules, although the Valencian government will still not comply with it. The three elements (deficit target, debt, and spending rule) constitute the path to stability.

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The Independent Authority for Fiscal Responsibility (AIREF, the state agency that oversees public accounts) has lowered its growth forecasts for the Spanish economy for this year and next due to international uncertainty. In response, it has stated that the State will have to take measures starting in 2027 to comply with the fiscal commitments required by European regulations.

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The tension in international trade due to the US tariff chaos will affect the Spanish economy. The extraordinary cabinet meeting this Wednesday. "Despite the tariff chaos, this week's power outage, and the natural disaster caused by the DANA, the Spanish economy will continue to lead the major eurozone economies in terms of growth," Cuerpo reiterated, estimating the impact at €400 million. the economic impact of the electrical incident

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The Spanish state approved projects and budgeted infrastructure works worth €35bn in Catalonia, which, on the other hand, have not yet been carried out. This is the calculation made by the Catalan employers' association Foment del Treball after analysing and comparing the initial budget of works announced with their final result over the last 12 years (between 2009 and 2020). According to Foment, this figure should be public since it "totally distorts the state budgets", since the works which have not been carried out "are appearing year after year in the budget" without an assessment of the real state of the works or what has already been invested and what has not.

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The Minister of Economy of the Generalitat de Catalunya, Jaume Giró, has called for "co-governance" and "co-management" of the European Union's NextGen funds that the State will receive. "Catalonia has done its homework with regard to the European Funds", he said, which is why he has called for support from employers and unions to prevent the Government from being "a simple administrator" of the funds and, to this end, he announced the creation of a "secretariat for economic affairs and European funds".

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The economy of the European Union will not recover the levels of 2019 (before the outbreak of the pandemic) until mid-2022. For this reason, and given the uncertainty of the context, the European Commission has proposed on Wednesday that the fiscal rules (the limit of deficit and public debt) continue to be suspended until 2023. Brussels activated the suspension clause of this fiscal straitjacket at the beginning of the pandemic, to give free rein to public spending in the face of the lockdown measures that have quarantined the economies of European partners.

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