MADRID - The deficit of the Spanish central government increased in the first five months of 2012, nearing the full year target, the Budget Ministry said in a statement on Tuesday.

The deficit stood at 3.4 percent of Spain's GDP at the end of May, only just short of the target of 3.5 percent for the entire year and significantly higher than the 2.59 percent registered at the same time last year.

The main reason behind the gap was the inability of Spain's 17 autonomous communities to meet their spending targets as well a reduction in tax revenue received by the central government.

However, Deputy Budget Minister, Marta Fernandez Curras was bullish about the figures and said she was confident that the government would meet its target.

"The deficit has begun a downward curve and we expect that the increase. We are determined that we are going to meet our budget target," she insisted at a press conference at which the figures were announced.

The government has been studying new mechanisms to raise tax revenue, according to sources in Treasury, who said that sales tax for a number of goods would be raised from 4 or 8 percent to either 8 or the standard rate of 18 percent.