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Spain Budget and Fiscal Policy
The budget of the central government reflected only a
part of
the financial resources involved in the execution of
fiscal
policy. Other official receipts and expenditures,
including
social security revenues and payments, local and regional
government taxation and spending, and the operations of
autonomous organizations associated with defense,
education, and
agrarian development, brought the total amount of
government
outlays in 1987 to 13,200 billion pesetas, or 41 percent
of GDP.
Thus, despite the sharp rise in revenues recorded in 1987,
the
central government deficit narrowed only from 1,659
billion
pesetas to 1,623 billion pesetas on a national accounts
basis.
Government spending tended to be expansionary. Even in
1987,
when government receipts were unusually high because of
strong
economic growth, a crackdown on tax fraud, and the
introduction
of a value-added tax in 1986, state expenditures
outstripped
state income and the government's deficit amounted to
about 3.8
percent of 1987's GDP. When regional and local government
expenditures were figured in, the total deficit amounted
to
approximately 5 percent. Budgetary estimates for 1988
indicated
that the central government deficit could be held to
approximately 3 percent of GDP. Initial budgets, however,
have
usually underestimated ultimate spending.
Data as of December 1988
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