This content is not available in your region

Portugal 2013 budget: Tax hikes and more cuts approved

Portugal 2013 budget: Tax hikes and more cuts approved
Text size Aa Aa

Portugal’s parliament has given final approval to its 2013 budget which includes the biggest tax increases in modern history.

The centre-right government used its parliamentary majority to pass the deal. It hopes to shave half a percent off the budget deficit next year to meet the terms of its international bailout.

Middle-class Portuguese families will be hit the hardest, paying 45 percent tax versus 35.5 percent now.

Arménio Carlos, Secretary-General of CGTP thinks incomes can’t be squeezed much further: “As much as the prime minister insists we are on track, everyone – even within his party – can see that this is the wrong way.”

The government hopes to increase tax revenues by 30 percent next year. At the same time a further 2.7 billion euros in cuts to pensions and public healthcare will be made.

The thought of that brought unions and political groups out to protest in front of parliament in Lisbon once again on Tuesday.

One protester, who joined the rally for the first time, said: “My executioners are this gentleman (the prime minister) and the minister of finance; they’re killing me little by little. Within a year – if the state budget is approved – we will die of hunger.”