A new legislative proposal has been submitted to the Portuguese Parliament by the political party Chega, aiming to alter the VAT rules for energy equipment. This comes after a similar proposal was initiated by the Livre party.
Chega’s proposal seeks to overturn the current laws in the State Budget for 2022 and 2023, which stipulate the cessation of the reduced VAT rate for certain energy equipment effective from June 30 this year. The party calls for the immediate reinstatement of the reduced rate.
The initiative, led by Chega’s parliamentary head Pedro Pinto, places responsibility on the PSD/CDS-PP government for the VAT increase from 6% to 23%, describing it as a direct fiscal blow to Portuguese families.
Chega argues that this is effectively a “heat tax,” affecting essential equipment for maintaining decent living conditions during the summer, particularly impacting the elderly, children, and the sick, rather than being a luxury tax.
The party illustrates the immediate impact, noting that an air conditioner priced at an average of 650 euros would incur over 100 euros in additional tax, rendering the purchase unattainable for many Portuguese families.
Chega criticizes the government led by Luís Montenegro for what they see as a deliberate act of easy revenue collection without technical studies or serious impact assessments, leading to a lack of fiscal predictability and trust.
They argue that the government not only hinders individuals who wish to invest in basic climate control but also impedes technological renewal of the housing stock, making replacement of outdated and inefficient equipment prohibitively expensive.
By immediately restoring the reduced 6% VAT rate, Chega claims that it will bring “fiscal justice” back to families purchasing “climate control equipment, heat pumps, and essential energy devices.”
Last Monday, Livre submitted a similar legislative proposal to reverse the VAT increase set for June 30. Meanwhile, the Socialist Party questioned the Minister of State and Finance, Joaquim Miranda Sarmento, about whether the decision was supported by any study.
Earlier, environmental organization Zero criticized the planned VAT increase on air conditioning and photovoltaic panels, labeling it as an “attack on climate policy,” suggesting that Portugal is moving contrary to EU trends.
