The lower house of Spain's parliament rejected the government's proposed spending framework for 2027 on Thursday, Reuters reports.
This dealt a fresh blow to efforts to approve a state budget before the end of next year's legislative term.
The proposal was rejected by 166 votes to 176, with five abstentions.
Spain has not adopted a new budget since 2023, as the minority coalition lacks sufficient support in a divided parliament. Instead, it postponed the 2023 budget bills for three consecutive years.
The failure to secure support from the conservative Popular Party (PP), the far-right Vox, the Catalan separatist Junts party and the far-left Podemos highlighted the challenges facing the government in breaking the parliamentary deadlock and restoring a normal budget calendar.
Some smaller parties that previously helped the government pass legislation have largely written off the remainder of the mandate, citing the impact of corruption investigations on the ruling Socialist Party.
Prime Minister Pedro Sánchez has repeatedly promised to complete the legislative term, despite growing pressure from the opposition to call early elections. If he does, the next general election in Spain must be held no later than August 2027.
However, MPs approved separate government measures aimed at protecting consumers and businesses from the economic impact of recent international conflicts.