The Govern de les Illes Balears has approved a non-financial spending ceiling of €7,160.88 million for 2027, the highest figure to date. The limit has increased by €598 million, or 9.11% compared with the amount approved for 2025, marking the first step towards preparing the next regional budget.
Antoni Costa, First Vice-President and Conseller d’Economia, Hisenda i Innovació, during the press conference following the Consell de Govern meeting. Photo: CAIB.
The agreement, adopted by the Consell de Govern on the proposal of the Conselleria d’Economia, Hisenda i Innovació, provides for a zero-deficit scenario for the fourth consecutive financial year, with a target of 0% of gross domestic product (GDP).
During the current parliamentary term, the spending ceiling has increased by €1,213 million, according to figures provided by the regional government.
Revenue forecasts for 2027
The Govern estimates that non-financial revenue will reach €6,707.47 million, 16.2% more than initially forecast for 2025. A further €453.40 million in national accounting adjustments will be added to this amount.
Revenue forecasts for the main taxes have also increased:
- Personal income tax (IRPF): €2,844.04 million, 11% more than in 2025.
- Value added tax (VAT): €1,950.16 million, an increase of 18.63%.
- Property transfer tax and stamp duty: €950.64 million, up 12.35%.
- Inheritance and gift tax: €84.05 million, with a forecast increase of 28.48%.
- Tourist accommodation tax: €149.41 million, based on tourism activity remaining at a similar level to 2026.
Overall, forecast revenue from direct and indirect taxes will rise from €5,938.57 million in 2025 to €6,666.85 million in 2027, according to the Govern’s estimates.
Regional financing and transfers
The Balearic Islands remain a net contributor to Spain’s regional financing system, with an aggregate contribution of €545.97 million. However, this contribution is €80.04 million lower than in 2025.
Meanwhile, forecast current and capital transfers outside the regional financing system amount to €470.78 million, 25.8% more than in 2025.
Of this amount, €286.89 million comes from sectoral conferences and other central government contributions; €152.27 million from the Insularity Factor; and €31.62 million from European funds, mainly the European Regional Development Fund (ERDF) and European Social Fund (ESF).
New tax measures will have an impact of €55 million
The spending ceiling includes an estimated €55 million reduction in tax revenue resulting from measures announced by the Govern during the general policy debate held this week in the Parlament de les Illes Balears.
Approval of the non-financial spending ceiling allows the preparation and subsequent legislative processing of the Balearic Islands’ 2027 budget bill to begin.
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