Winemakers in uproar over possible tax hike

Winemakers in Portugal have warned of the “very serious consequences” that a mooted tax hike would have on the sector, suggesting it would force companies into liquidation, leave vineyards ‘abandoned’ and lead to soaring prices in the shops.

National tabloid Correio da Manhã claimed in a story last week that the government was “studying a tax hike on the wine sector as a way of obtaining more tax revenue”.

It is an issue that has received no corroboration anywhere else. Nonetheless, the president of ACIBEV – Portugal’s association of wines and spirit drinks – has come out fighting.

“The tax hike would lead to a wine price increase which would affect the whole sector,” Ana Isabel Alves told Lusa news agency.

“We fear people will leave vineyards, which will lead to the desertification of rural areas,” she said.

“We have 200,000 hectares of vineyards in Portugal. The tax hike will make small companies unfeasible and many will inevitably close,” Alves added.

She also said the news comes at a time when the sector is facing enough trouble as it is, with two of its main buyers – Angola and Brazil – embroiled in economic problems.

ACIBEV has thus sent strongly-worded letters to the Ministries of Finance, Economy and Agriculture as well as all parliamentary groups, saying: “We hope the government will listen and not implement the hike.”

Seven wine associations in Portugal have also released a statement in which they criticise the idea, saying: “We vehemently condemn the application of more taxes on a sector that represents over 200,000 jobs, exports €730 million (worth of products) and is a vital sector of the country’s exports, contributing to the positive image of our country.”

They add that winemaking is “very important to rural communities, some of which are totally dependent on it”.

Contacted by Lusa, a source from the Ministry of Finance said it would not be commenting before the budget was presented.

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