OE 2017 will have measures to increase indirect taxes of 210 million euros – publico

 
         

                 

                         
                     

                 

 
 

To offset the effect of IRS surcharge disappearance and reduction of VAT in the restoration, the Government is planning for 2017, the adoption of measures to ensure the increase in revenue from indirect taxes of 210 million euros. For 2018 and 2019 the increase in indirect taxes will continue, with over 90 million revenue euros each year.

In a table that was not in the first version of the stability program, but that the Government He decided to come to Parliament and other entities that oversee the Portuguese public accounts, including the European Commission, the executive aware of the impact of fiscal consolidation measures that hopes to put into practice in the period 2017-2020.

the document, to which the public had access, shows that the Government expects that the measures that will be applied (and in some cases already implemented) will result in a reduction in revenue of 60 million euros in 2017 and a cut 406 million expense, which is a positive contribution to the deficit of 346 million euros.

This means that the reduction for the 2017 deficit of around EUR 1500 million (equivalent to 0.8 percentage points of GDP), only 346 million are due to fiscal consolidation measures actually taken. Then there are 450 million related to the extraordinary expected revenue from the reckoning in BPP, leaving just about EUR 700 million reduction in the deficit that the government is after getting through the positive budgetary effect of economic growth.

hamper the accounts of the Government is the fact that some measures already taken in 2016 to extend its negative effect on public finances for 2017. this is the case of the IRS surcharge disappearance that was started last year, and which will lead to a reduction in tax revenue in 2017 of EUR 380 million. Similarly, the reduction in VAT in catering, will reduce revenue by over 175 million euros next year (the first in which the measure will be in force from beginning to end of the year).

to compensate for this loss of tax revenue, the government plans to adopt measures resulting in an increase in revenue from other indirect taxes (excluding VAT). In the table, it is specified that taxes may not be in question, but the revenue increase expected from these measures is EUR 210 million next year. In 2018 and 2019, the expected increase in revenue is EUR 90 million in each year.

The worsening of other indirect taxes has been the strategy followed in 2016 by the increase in the tax on oil products, tobacco tax and stamp duty.

the extent to which the Government has more help in reducing the deficit is the expenditure side. There will be a freezing of intermediate consumption expenditure (except PPP), which is a positive contribution to the improvement of the fiscal balance of 300 million euros in 2017.

Then the government has to save EUR 186 million with measures such as early repayment of IMF loans and EUR 122 million by reducing the number of civil servants. Is this type of action that compensates for the effect on spending spare the salary level of civil servants, which will be in 2017 of 257 million euros.

For the following years, the government expects that the measures it have taken a stronger direct effect on reducing the deficit.

in 2018, a positive impact is estimated at 581 million euros, a figure slightly below 0.3 percentage points when the total reduction deficit expected for this year is 0.5 percentage points.

in 2019, the expected positive impact of the measures amounts to 706 million euros, and for 2020, the government estimates point to a 377 effect million.

in the period 2018-2020, it is the freezing of intermediate consumption costs (operating costs of public services) and the reduction in interest costs that contribute most to the deficit reduction .