MPs in the lower house have voted to create an investigative commission into the allegations.
The commission will investigate the possible ‘existence of different networks of irregular donations, the awarding of public contracts and other mechanisms of irregular funding.’
It comes after Luis Barcenas, a former PP treasurer and one of the many ex-PP lawmakers on trial for corruption, said publicly that Rajoy’s party had a slush fund.
Investigators will also be ascertaining how much the party benefited from PP MPs who offered public contracts for bribes.
The EU has blasted corruption in Spain in recent times, and has labelled Andalucia as the most corrupt region in Spain.
A series of corruption scandals has caused popularity for the PP to wane, with Rajoy being forced to rule with a minority government after his party failed to win an overwhelming majority of votes.