King Philip II of Spain was not lucky. His late father, King Charles V had left him a huge national debt and he defaulted on his own loans four times between 1557 and 1596. One big issue was that Spain had back them the greatest Empire in the world but the kingdom of Spain proper was not heavily populated and thus tax revenue was minimal, especially since local lords took most of it for themselves. Spain became heavily reliant on revenue from its colonies in the New World and Asia to pay for expenses but even that did not prevent loan defaults in various occasions.
King Louis XIV of France also inherited a dire financial situation but he had the foresight to choose a very capable and diligent Minister of Finances, Jean-Baptiste Colbert. Colbert applied very efficient taxation, forbidding the auctioning of taxes and of exemptions that had not been authorized by the government. He also made it mandatory to keep accurate records on all forms of taxation so as to prevent embezzlement of these funds by corrupt tax officials. The deficit was resorbed as well as the national debt. However, his extremely lavish lifestyle and his constant wars against other European powers eventually would undermine the beneficial aspects of his reforms. Also, he refused to tax nobility and most taxes were paid by peasants.
