Tax revenue up by extra €1.4 billion

The Portuguese State earned €19.2 billion in tax revenue from January to July – up 7.6% on last year – and direct taxes IRS and IRC were mainly responsible for the extra income.

In the first seven months of 2013, the state’s coffers received an extra €1.357 billion in tax revenue in comparison to the same period last year, according to data from the Directorate-General for Budget.

Individual income tax (IRS) alone contributed to a revenue rise of 36.8%, amounting to an income €5.825 billion.

On the other hand, IRS tax refunds continue to fall. Tax rebates for the 2012 tax year decreased 14.2% in July and 5.4% in July, to around €1.6 billion.

With regards to company tax IRC, revenue grew 7% to just under €3 billion, contradicting the estimated 3.1% decrease announced by the government in the Amended State Budget for this year.

Indirect taxes, however, continue to fall, with VAT, a key revenue source for the State, registering a 1.3% decrease up to July.

Whilst indirect taxes fell 1.9% (with the exception of the road circulation tax Imposto Único de Circulação) to around €10.3 billion, direct taxes saw a 21.4% increase in revenue to €8.8 billion.