Portugal applies the “tax shock” to revive
Lisbon Socialist government announced yesterday an austerity plan which consists mainly of raising taxes, measures to reduce the budget deficit which has reached a historical low level.
Prime Minister Jose Socrates has pledged to the European partners to reduce the deficit from 9.4 to 7.3 percent of GDP – the equivalent of 2.1 billion euros – until the end of this year instead of 8.3 as it planned was initially, and 4.6 percent in 2011.
The adopted plan includes VAT by one percentage point increase (21%), corporate tax by 2.5 points to 27.5 percent, 1.5 points additional for the income tax.
Politicians’ and people’s in management positions in public sectors wages will be reduced by five percent, writes the Financial Times.
Also, government funding for local authorities will be reduced by 100 million euros this year.
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Posted by AnnabelleLion on May 15 2010 Filed under Finance. You can follow any responses to this entry through the . You can leave a response or trackback to this entry
