The aim of the measure is to increase investments and boost the country’s economic growth
The government of Portugal announced on Thursday (4.Jul.2024) the gradual reduction of the IRC (Corporate Income Tax) from 21% to 15%. The change is part of a package of economic measures provided for in the government program of the AD (Democratic Alliance), elected in March of this year.
The announcement was made by the Minister of Finance, Joaquim Miranda Sarmento, after a meeting of the Council of Ministers.In 2026, the rate will drop to 17% and in 2027, to 15%”, explained Sarmento. “The 2 percentage point drop means around €500 million per year of direct effect”, he informed, highlighting that the expected financial returns were not included in the calculation.
The reduction in taxes charged to companies is one of the 60 measures included in the Accelerate the Economy program. According to the government, the objective is to boost economic growth and investment in the country, with a consequent increase in wages.
Opposition lawmakers criticized the proposal for being “burdensome to the State” and make negotiations on the next Budget more difficult. As the government does not have a majority in the legislative house, it will have to negotiate to get the project off the ground.
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