The extra tax policy was implemented to bring extra revenue for the State Budget. However, there is a direct and immediate trade-off. For every property to pay the extra tax, someone is going to lose their job.
After several years of recession in Portugal and its main markets, the UK, Ireland and now even Holland, the bombing of the stockmarket andpeople’s pension funds, the majority of once-wealthy property owners is struggling. Property has moved from being an asset to being a cost.
And, therefore, something has to give. In this case, it will be the expenses in maintenance, gardening, cleaning or other jobs, who live very much from €1 million properties.
The impact will be felt still in this year’s State Budget, when many of the service companies have no other choice than to close and many of those working in the industry will apply for unemployments benefits.