Fiscal Rules and Fiscal Councils: Recent Trends and Revisions since the Pandemic

IMF Working Papers, October 3, 2025

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Canonical URL: Fiscal Rules and Fiscal Councils: Recent Trends and Revisions since the Pandemic

Authors: Virginia Alonso-Albarran, Clara Arroyo, Ozlem Aydin, Hamid R Davoodi, Waikei Raphael Lam, Vybhavi Balasundharam, Gabriel Hegab, Anh D. M. Nguyen, Natalia Salazar, Galen Sher, Alexandra Solovyeva, Nino Tchelishvili
Published: October 3, 2025
Series: IMF Working Papers
DOI: https://doi.org/10.5089/9798229025072.001

Examines the evolving landscape of fiscal rules and fiscal councils worldwide, focusing on developments since the pandemic.
Draws on the latest updates to the IMF’s Fiscal Rules and Fiscal Councils databases—which cover more than 120 economies and 54 fiscal councils.
Publication type: IMF Working Paper (Working Paper No. 2025/198), Pages: 43, Volume: 2025, Issue: 198, DOI: https://doi.org/10.5089/9798229025072.001, ISBN: 9798229025072.

Adoption trends
- Documents the increasing adoption of fiscal rules, particularly in emerging markets and developing economies.
Legal foundations and rule design
- Highlights improvements in the legal foundations and flexibility of fiscal rules.
Role of fiscal councils
- Notes a growing role for effective fiscal councils in providing oversight.
Compliance and implementation
- Despite advancements, compliance remains uneven, with widespread and persistent deviations from deficit and debt rule limits.
Measurement innovations
- Introduces new indices to quantify the overall strength of fiscal rules and the institutional quality of fiscal councils.
- Finds significant cross-country variation in these indices.
- Reports a positive correlation between the strength of rules and fiscal discipline.

Strengthened rule frameworks and better-designed flexibility can coexist with persistent compliance challenges.
Effective fiscal councils play an increasing oversight role that complements rule-based frameworks.
Quantitative indices enable cross-country comparison of rule strength and council institutional quality and provide empirical linkage to fiscal outcomes.

Fiscal Rules and Fiscal Councils: Recent Trends and Revisions since the Pandemic — IMF Working Paper, October 3, 2025.