More than 1,800 alterations proposed
The tortuous process of ratifying the PS government’s State Budget for 2023 draws towards its close this week, with voting and debating beginning on the more than 1,800 amendment proposals submitted by parties in opposition.
As Lusa reports, the number of attempts at ‘change’ in the lead up to final voting on Friday (November 25) is “a new record”.
CHEGA leads the way in the number of proposals, with 506, followed by PCP Communists with 425. PAN delivered 262 proposals, while the largest opposition party, PSD, presented 263.
The Left Bloc presented 156 proposals, Livre 138 and the Socialist Party itself 73. Liberal Initiative was the party with the lowest number of proposals presented: just 34.
The proposed state budget for 2023 was approved in general terms on October 27 (the only votes in favour coming from the ruling Socialist Party).
Lusa has summarised the key points of proposed amendments:
“The PS has guaranteed the viability of its proposals, which include increasing the Municipal Property Tax (IMI) rate for housing located in areas of urban pressure up to double and reducing the deadline (from two to one year) for the application of the increased rate of this tax for vacant properties located in these areas.
“The Socialists also want, among others, a tax amendment to support companies in terms of corporate income tax, which aims to increase the deduction to the tax collection for companies located in less developed regions to correct the increase in pensions if inflation is higher than expected and to extend, until the end of 2023, the measures to contain energy prices, via fuel tax, and agri-food prices, such as the VAT exemption on fertilisers.
“The PS also wants to guarantee exemption from stamp duty on credit renegotiations and end the differentiated tax treatment between residents and non-residents on capital gains generated from property sales.
“The PSD proposes, among other measures, to allow municipalities to reduce IMI collection to a minimum of 0.1% and the possibility for families to deduct the costs of interest and capital on housing loans (only in the case of owner-occupied permanent housing) from personal income tax, increasing the value of the deduction to €680.
“The social democrats also defend a reduction in the IRS taxation of savings (reducing the final rate from the current 28% to 10% for savings of up to €100,000) and the VAT exemption on the purchase of food for the solidarity sector during 2023, as well as, in addition to the proposal that had already been presented to reduce the company tax from 21% to 19%, the change of the system of Tax Incentives for Research and Business Development (SIFIDE), excluding investment funds and increasing eligible expenses in the energy, environmental and digital transition.
“CHEGA wants the reduction of VAT rates “in general” and a zero rate for essential goods, the “suspension of IMI payments throughout” next year, and to do away with the taxation of holiday and Christmas subsidies next year.
“The party also proposes until the end of this year – with the possibility of renewal for equal and successive six-month periods and while the instability of fuel prices is maintained – an extraordinary discount on the price per litre of liquid fuels (diesel and petrol) of 0.20 cents per litre at public petrol stations, as well as the extension of the social tariff for energy, considering the first 200 kWh consumed per family and per month and provided that the contracted power does not exceed 10.35kVA.
“Liberal Initiative proposals include the reduction of VAT on energy and food goods and the lowering of personal income tax in the first five tax brackets, the reduction of corporate tax rates and the elimination of the state surcharge, as well as the privatisation of at least 50% of TAP, and the sale of the state’s stake in Caixa Geral de Depósitos and RTP.
“IL also proposes the creation of a voluntary housing supplement that, up to the additional €250 paid by the employer, is exempt from taxation, as is the case with the meal subsidy and insists on the attribution of a family doctor in the private sector whose costs would be paid by the state if the public does not meet this need, as well as the regulation of USF type C, a possibility that the minister of health, Manuel Pizarro, admitted in the scope of the budget hearings.
“The Left Bloc proposes that pensions be increased according to the legal formula in force and that the personal income tax brackets be raised to the inflation rate and insists on the taxation of excessive profits in the area of banking, energy and retail, the end of exemptions for operations with cryptocurrencies, the lowering of VAT on electricity and gas to 6% and clarification that dams have to pay IMI.
“The Left Bloc also want compensation to be created for displaced teachers (who are placed more than 60 kilometres from their residence), to prevent the creation of type C Family Health Units and to end tuition fees, as well as the extension of the 2% limit for rent updates to new contracts, the end of golden visas and the obligation for banks to renegotiate housing credit contracts under certain conditions.
“The PCP proposes a minimum €50 increase in pensions, as well as the possibility of retirement without penalty after 40 years of contributions, and the creation of a public network of free crèches and nurseries for all children.
“The communist proposals also include extraordinary taxation on companies in the energy, large distribution, banking and insurance sectors whose profits exceed €35 million, with a rate of 35% on profits above the average profits made in the last four years.
People Animals Nature (the sole member of which abstained from the general voting in October):
“PAN defends the extension of the social tariff for energy to all people living below the poverty line, a free travel pass for young and old to the whole country, the deduction of expenses with interest rates from personal income tax, as well as the reversal of support given to cellulose companies.
“PAN also wants the extension of the carbon tax to private jets and the reinforcement of funds to animal collection centres, proposals that the minister of finance has signalled his willingness to make possible during the debate at the committee stage.
Livre (sole member of which abstained from voting in generality in October):
“Livre is also proposing to increase the budget to tax private jets and to increase funds for animal collection centres.
“Livre also wants to extend the budget (through European funding) and the scope of the ‘Home, Comfort and Climate’ programme – a party proposal that was given the ‘green light’ in the previous budget – and for “people on lower incomes” to see the cost of energy and thermal intervention in their homes covered at 100%, as well as that the state will advance “the value of support for projects to be initiated under the programme in service buildings, so there is no longer the need to have the amount available to start or to resort to credit”.