Portugal Reports Strengthening Finances

by Ulrika Lomas, Tax-News.com, Brussels

30 December 2014

Portugal's tax revenue amounted to EUR33.55bn (USD40.93bn) between January and November 2014, representing a 6.2 percent increase from the same period in 2013, the Ministry of Finance announced.

The growth rate is higher than that forecast by the Government in the second amendment of the 2014 Budget.

In the 11-month period, revenue from the value-added tax (VAT) and the personal income tax grew seven percent and nine percent year-on-year, respectively.

The Finance Ministry said that the improved revenue receipts are due to a recovery in economic activity in the country and the effectiveness of new measures to combat tax evasion and the grey economy.

The Government's budget deficit reached 4.9 percent of gross domestic product (GDP) in the period from January to September, down from 5.7 percent in the same period last year.

Portugal's 2015 Budget targets a further reduction in the deficit to 2.7 percent of GDP, with one of the key measures being a reduction in the corporate income tax rate from 23 percent to 21 percent.

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