In a press conference at the Assembly of the Republic, the IL parliamentary leader, Mariana Leitão, criticized the government’s proposed IRS reduction, deeming it “clearly insufficient and ineffective” with “minimal real-life impact on the Portuguese population.”
“For a person receiving a salary of 1,000 euros, the monthly decrease is 2.5 euros. For someone earning 2,000 euros, the reduction is nine euros per month,” she exemplified.
Nevertheless, the IL parliamentary leader indicated that the party will vote in favor of the government’s proposal, adhering to its principle of never voting against tax reductions, but it will not refrain from presenting its own initiatives to strive for a more ambitious IRS reduction.
In its legislative project, IL proposes that the IRS should have only two brackets: one for incomes between 12,180 and 26,768 euros annually, taxed at 15%, and another for incomes exceeding 26,768, taxed at 28%.
Mariana Leitão argued that reducing the number of brackets is “fundamental to simplify and eliminate the current penalty on those who want to advance in their careers” and considered the IL’s proposal “much more ambitious, concrete, and impactful in people’s lives” compared to the government’s.
“For someone earning 1,200 euros per month, for instance, the government’s proposal results in a reduction of four euros per month. The IL’s proposal offers 76 euros per month,” she illustrated.
Regarding the cost of this tax cut, Mariana Leitão indicated it would mean “relief” of 3.2 billion euros to public finances, claiming it is nearly the amount the state has generated in IRS revenue over the last five years.
“Therefore, we are simply telling the government to revert five years back and, instead of continuing to penalize the Portuguese as they have by increasing the tax burden or making reductions that are barely noticeable, let us return to the values of five years ago,” she urged.
When questioned if she believes the IL’s proposal might be embraced by the government, Mariana Leitão said that, “unfortunately,” the executive has shown signs of being “unambitious,” but emphasized that IL intends to continue proposing what it considers essential.
“It is clear that the government is much more moderate in the way it presents its proposals, arguing with supposed precise accounts that can only allow for this relief,” she criticized.
