The government's proposed 2027 State Budget projects a 0.1% surplus (about 270 million euros) and excludes measures like a zero-IVA rate on food or an IVA reduction on fuel. The Finance Minister warned that adding such measures would push the state into a deficit and urged opposition parties not to alter the budget during November's parliamentary discussions.
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The 2027 State Budget signals a shift away from the extraordinary funding of the Recovery and Resilience Plan (PRR), with public investment (excluding PRR) set to grow by 6.8% to 9.687 billion euros. Total state spending is projected to increase by 5.7%, while interest payments on sovereign debt are expected to rise significantly by 23.2% to 8.2 billion euros.
The Socialist Party (PS) announced it will abstain in the general vote on the 2027 State Budget to ensure stability, but warned that agreed conditions must be met for the final approval. Meanwhile, PSD and CDS called for political responsibility.
The 2027 State Budget projects a 7 billion euro surplus for the Social Security pension system (2.1% of GDP), driven by growth in contribution revenues. However, the budget report warns that the system is expected to face structural deficits beginning in the 2040s, primarily due to the rising long-term costs of pensions.