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Portugal: 1 July – main budget changes

Page created: Friday, 1 July 2016 14:50 GMT

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Budget  Tax System  VAT
Lisbon, Jul. 1 (Lusa) – The first day of July marks the beginning of various measures contained in this year’s budget that had not yet been implemented such as the reduction in VAT for restaurants and the return to the 35-hour week for state workers.
Some of the main changes todays include:
VAT in restaurants is back down to 13% from 23% in mainland Portugal, except for most drinks which stay at 23%. The Maximum VAT bracket was imposed as part of the austerity measures the troika required of the previous coalition government, but it was widely opposed and blamed for the closure of hundreds or thousands of restaurants.
The price of tobacco is going up today to reflect the higher taxes and packs of cigarettes are expected to increase by about seven cents according to PricewaterhouseCoopers (pwc).
Natural gas is to come down for families and industry today with reductions of between 13 for the former and 20% for the latter.
This second fall in gas prices this year will benefit all natural gas consumers (about 1.4 million), because of a cut in access rates to some networks imposed by the energy sector regulator.
State sector workers are back to a 35-hour week as of Friday but with some exceptions after having had to do a 40-hour week for almost three years despite strong contestation.
SP/ADB // ADB.
Lusa