Lawmakers weigh Q192 billion 2027 budget proposal for election year

Guatemala’s proposed 2027 budget has drawn immediate scrutiny from lawmakers after the Finance Ministry submitted a spending plan worth Q192.045 billion, more than Q23 billion above the current 2026 budget.

The proposal comes after President Bernardo Arévalo’s government began the current fiscal period using the 2025 budget. The Constitutional Court had suspended Decree 27-2025, although Congress later approved an expansion that gave the Semilla administration a spending plan of Q168.789 billion.

Julio Héctor Estrada, chairman of Congress’s Finance Committee, said lawmakers would begin hearings after the proposal reaches the full chamber. The first hearing is scheduled for Sept. 22 and will include officials from the Finance Ministry, the Bank of Guatemala and the Superintendency of Tax Administration. Lawmakers are expected to examine the proposal’s financing sources, macroeconomic assumptions and spending plans before hearing from individual ministries about their requests.

Estrada questioned the size of the increase. “The amount in the budget is impressively large, with growth of 65 percent. They are creating many funds and many pockets; I think some of that will have to be cut, and that would reduce borrowing,” he said.

He said the proposal includes about Q40 billion in borrowing, roughly one-quarter of the budget, at a time when debt is expensive globally. Debt and interest payments currently consume 16 percent of the budget, while the proposal could raise that share to 22 percent, a change Estrada said could eventually mean higher taxes.

Estrada called for a conservative approach to borrowing and said the government should operate within its means. He also warned that the proposal would change during a complex technical and political debate. He said the committee was surprised because Finance officials had previously indicated budget ceilings Q10 billion lower than the submitted figure. The committee expects to issue its report in the first week of November.

José Chic, deputy leader of the VOS bloc, also highlighted the increase of more than Q20 billion and questioned government implementation, saying budget execution was worsening, including in road infrastructure and the Agriculture Ministry.

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The amount in the budget is impressively large, with growth of 65 percent. They are creating many funds and many pockets; I think some of that will have to be cut, and that would reduce borrowing.