“This is a Budget that exacerbates fiscal injustices, not only with the reduction of the IRC [by another percentage point, to 19%], but also with the maintenance of tax benefits which are estimated to be around 1,800 million euros,” stated the PCP parliamentary leader, Paula Santos, in the Assembly of the Republic.
The PCP parliamentary leader alleged that the State Budget proposal for 2026 also foresees “the reduction of the TSU (Social Security Contribution Rate) for employers,” thereby “weakening Social Security.”
“This Budget has the total opposition from the PCP,” stated Paula Santos, accusing Chega of being in “convergence with these options” and the PS of having already made clear “its commitment to all these options” of the PSD/CDS-PP Government.
The deputy highlighted the openness to enable the Budget shown by the PS secretary-general, José Luís Carneiro: “On the part of the PS, it is indeed noteworthy the reference made that it will be easier to approve the Budget.”
Paula Santos argued that the Government led by Luís Montenegro is trying to present its proposal as “a technical document, to facilitate its approval either with Chega or with the PS,” but the Budget should be seen as “a political instrument.”
The PCP secretary-general, Paulo Raimundo, had announced at the end of September that his party would vote against and do everything to block the State Budget proposal for 2026.
Today, in an initial reaction to the proposal’s content, the PCP parliamentary leader argued that the Government “insists on political options of low wages, low pensions, destruction of public services, real estate speculation, and favoring of major economic interests,” and “undermines public investment.”
According to Paula Santos, issues in sectors like health, education, and housing are overlooked by the PSD/CDS-PP executive. “Allow me to say, they couldn’t care less about the concrete problems that people face every day,” she said.
The PCP proposes raising the national minimum wage to 1,050 euros and increasing pensions by 5% or 75 euros, she noted.
The PCP parliamentary leader criticized the tax benefits for “non-habitual residents, which are estimated to be around 1,900 million euros,” as well as the “privatizations, asset disposals” and the “transfer of public resources to public-private partnerships (PPP), amounting to 1,500 million euros.”
According to the PCP parliamentary leader, there are “transfers of about half of the National Health Service (SNS) budget to private groups.”
“Therefore, we are talking about a proposal that not only does not solve the problems faced by workers and the people in our country, but also aggravates them,” she concluded.
On September 19, a government draft law to reduce the IRC rate by one percentage point per year to 17% by 2028 was approved in principle in parliament, with votes in favor from PSD, CDS-PP, Chega, IL, PAN, and JPP and votes against from PS, Livre, and PCP. The plenary debate and final global vote are pending.
The report accompanying the State Budget proposal for 2026 foresees in a table on the “main budgetary policy measures impacting 2026” a one percentage point reduction in the IRC, estimated to cost 300 million euros.
The PSD/CDS-PP Government submitted the State Budget proposal for 2026 in parliament today, a day before the deadline and three days before Sunday’s municipal elections.
The State Budget proposal for 2026 will be debated and voted on in general from October 27 to 28. The final global vote is scheduled for November 27, after the plenary debate.
In the macroeconomic scenario underpinning the Budget proposal, the PSD/CDS-PP Government expects the Gross Domestic Product (GDP) to grow 2% this year and 2.3% in 2026.
The second minority government led by Luís Montenegro aims to achieve surpluses of 0.3% of GDP this year and 0.1% next year. As for the debt ratio, it is projected to decrease to 90.2% of GDP in 2025 and 87.8% in 2026.
