The country's score dropped from 8.30 to 8.08 in the Economist Intelligence Unit's (EIU) 2017 Democracy Index due to “its attempt to stop by force Catalonia's illegal referendum on independence on October 1 and its repressive treatment of pro-independence politicians.”
That same ranking for 2016 was cited by King Felipe VI last week to defend Spain's democratic credentials.
The country's score remains just above the threshold of 8.01 for full democracies but Joan Hoey, editor of the index, warned it could further deteriorate depending on what happens this year.
Catalonia's secession crisis captured the world's attention when a banned independence referendum was met with a massive police crackdown in October.
The central government argued that the vote had been ruled illegal by the Constitutional Court, justifying the use of police to try and stop it.
It has always insisted it is on the side of the law in its handling of the crisis.
But Hoey said the use of “heavy-handed legalism to deal with what is essentially a democratic question or to deny a democratic vote” was “not really the sign of a government that cherishes democracy and wants to expand it.”
The ranking also pointed to the charges of rebellion, which carries up to 30 years in jail, and sedition brought against Catalan leaders over their failed bid for independence.
In this day and age, in a modern democracy, to see elected politicians being charged with what seem quite archaic charges… doesn't seem to sit well with Spain's ranking as a full democracy, of which there are only 19 in the world,” said Hoey.
The index is based on five categories including the functioning of government and the electoral process.
Based on its score, each country is then classified as a “full democracy,” “flawed” one, “hybrid regime” or “authoritarian” one.
The ranking classified Norway as the top democracy while North Korea came last.
The Gambia was upgraded from an “authoritarian regime” to a “hybrid” one after it witnessed its first ever democratic transfer of power.
Venezuela, by contrast, moved the other way to an “authoritarian regime.”
“The latter change reflects Venezuela's continued slide towards dictatorship,” the ranking said.