The president of the Portuguese Banking Association (APB), Vítor Bento, believes that the country’s priority should be to reduce public debt and stresses that having a budget surplus does not mean living lightly.
“A country that owes a year’s income never has a surplus, it doesn’t have too much money, on the contrary, it has too little. A surplus doesn’t mean that we’re suddenly loose,” says Vítor Bento, in an interview with Negócios and Antena1.
For Vítor Bento, the most important thing is to reduce the debt “to sustainable levels”, especially in a scenario of uncertainty, in which the economy could fall into recession.
Even so, the president of the APB considers it desirable to reduce the tax burden on companies, based on a review of tax benefits and moving towards a reduction in the corporate income tax rate to 15%, a goal that has already been set by the prime minister, Luís Montenegro.
According to Vítor Bento, the idea that there is a surplus and the current situation of “greater political fragility” could lead to an increase in demands and a rise in social tension.
However, he stresses, the economy cannot satisfy everything and, in this sense, he hopes there will be “common sense on the part of the opposition”.
For the time being, “on the surface”, Vítor Bento approves of the composition of Luís Montenegro’s executive, but says that “governments are like melons, only after they’ve been opened do you know if they’re good or bad”.
In any case, he believes it is possible to learn to work with a parliamentary base based on a relative majority, once “there is the will and the ability to negotiate”.
He does not comment on the need for an amending budget, but points out that if there is a surplus, it is probably on the revenue side and cannot be transposed to expenditure.
In the interview with Negócios and Antena1, Vítor Bento also said that one of the concerns he will raise with the new government is “the excess of extra-dinary taxation” on banking, adding that the APB will call for an end to extraordinary contributions, because the measure creates a distortion in the market by creating a disadvantage for banks located in Portugal.
The association’s leader intends to ask the new finance minister, Joaquim Miranda Sarmento, for a meeting soon and remind him that the solidarity surcharge that continues to be levied on banks has already been ruled unconstitutional.
For 2024 and after a year of historic profits, Vítor Bento predicts that “in terms of profitability” there is likely to be a “slowdown” as interest rates fall.
