Thanks to higher tax revenues, Spain cut its budget deficit dramatically in the first quarter of this year. The cumulative deficit of the Spanish authorities amounted to 29.6 billion euros and 2.27 percent of GDP, as announced by the Budget Ministry in Madrid. In the first quarter of 2021, the public deficit was 4.45% of GDP.
The ministry notes a good development in tax revenues due to the “economic boom” and the presence of a large number of new jobs. In the first six months, tax revenue was €115.3 billion – up 23.2 percent from the previous year. Revenue from value-added tax increased by 19.7 percent, while income and property taxes brought in 35.4 percent more.
Madrid can put the money to good use: the government has set aside nearly 30 billion euros for measures to ease inflation such as fuel cuts, pension increases and free tickets for local public transport. Despite this extra spending, it has set itself the goal of reducing the budget deficit and national debt from 118.4 percent of economic output to 115 percent.
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