Finance minister toys with €400 million IRS reduction
Portugal’s finances minister Fernando Medina has mooted that if government growth forecasts meet a 1.8% target, it might be able to reduce the tax burden by €400 million.
The tax relief would be included in the State Budget for 2024, the amount being higher than outlined in the government’s Stability Programme for 2023-2027 which was handed to parliament at the beginning of this week.
Without going into specific details, the document foresees IRS relief of €400 million for next year and additional measures to alleviate taxes which would provide an IRS relief of €250 million a year over the subsequent three years.
And the Government could go further if the economy goes better than expected by the time that the budget programme for 2024 is presented.
“If the prospects are reflected in the results, and if the results are better than expected, we could go further”, the minister said on Wednesday at the conference Sustainable Business 2030 organised by the business title Negócios.
On Monday the minister of Finances revised Portugal’s growth forecast upwards from 1.3% to 1.8% because of the improvements in export figures – particularly tourism services in the first quarter of 2023.
In addition to these measures, the Government outlined others to be adopted this year, including updating IRS tax brackets, pensions, and a reduction in marginal tax to the 2nd IRS bracket — estimating a IRS tax concession of €2.011Bn by the end of the period 2023-2027. The new Stability Programme will be debated in Parliament on April 26.
Photo: Carlos M. Almeida – Lusa