“We have good news from a budgetary execution standpoint, a robust surplus,” stated the Finance Minister during a press briefing in Lisbon. “The Portuguese economy is strong, growing, creating jobs, raising wages, and the public sector is in a comfortable fiscal position,” he noted.
The Finance Minister also indicated the possibility of new measures: “We now have the leeway to propose new measures that a year ago were not possible,” he asserted, while clarifying that the surplus “does not carry over from one year to the next, it allowed for a more pronounced reduction in public debt compared to previous forecasts.”
Regarding taxes, despite the data showing an increase in the fiscal burden in 2024, the Minister emphasized that much of what has been done in terms of taxes, particularly regarding income tax (IRS), “will take effect in 2025 and not in 2024.”
The measures already implemented “reduce family income tax by 1.8 billion euros,” and with the commitment to reduce 3 billion euros, the Government has already fulfilled two-thirds of its promise, he stated.
“In the revision of the electoral program, we will examine the tax burden. We continue to aim to reduce the tax burden more and more, especially on families and also on companies, and will update the measures from a fiscal standpoint,” he said.
Miranda Sarmento emphasizes that the surplus exceeded the Government’s expectations due to the “performance of the Portuguese economy.”
(GDP), in national accounting, surpassing the 0.4% estimated by the Government, according to data released today by the National Statistics Institute (INE).
“The positive balance of the Public Administrations sector, as a percentage of GDP, stood at 0.7% in the year ending in the 4th quarter of 2024, equal to that observed in the previous quarter (1.2% in 2023),” states the Quarterly National Accounts by Institutional Sector.
This quarterly development was due to an increase in expenditure (0.9%) identical to the increase in revenue (0.9%). In State revenues, it is noteworthy that current revenue rose by 1.3%, which “reflects increases in all its components, except for income and property taxes (-2.2%),” due to the application of new IRS withholding tables.
As for expenditure, INE highlighted the 2.1% increase in current spending and an 11.1% decrease in capital expenditure.
[Updated at 14:05]
