The Council of Public Finance (CFP) said Thursday that the tax burden rose in 2015, standing at 34.4% of GDP, an increase of 0.3 percentage points compared to 2014 reflecting the increase the weight of indirect taxes.
in regard to the analysis of government 2015, published today, the CFP states that “the tax burden has to increase after a year of near stabilization”, reaching 34.4 % of Gross Domestic Product (GDP) last year, an “increase of 0.3 percentage points [that] reflects the increased weight of indirect taxes to 14.5% of GDP.”
in 2012 , the tax burden was 31.7% of GDP, rising to 34% in 2013 and to 34.1% in 2014, recording a new high last year, reaching 34.4%, according to the CFP report.
the institution led by Teodora Cardoso indicates that “three quarters of the increase in tax revenue [in 2015] were to be-to indirect taxes,” adding that “the recovery in economic activity in 2015 and measures to combat fraud and tax evasion contributed, similarly to what happened in 2014, to raise the VAT revenue “.
As for other taxes, CFP highlights the increases of 6.3% tax on Oil Products (ISP) and 22.8% of the Vehicle tax (ISV), “reflecting the effect of the reform of Green taxes, together with the increase of their respective tax bases.”
Among the measures provided for in the reform of Green taxes were the implementation of a carbon tax, which was charged as an addition to the ISP, and the increase of 3% of the ISV rates in terms of CO2 emissions.
in addition, the CFP also states that the VAT “justified about half the growth of indirect taxes” in 2015, but notes that the evolution of this tax “was increasingly less favorable” throughout the year, slowing reflection of revenue and also the fact that the reimbursements have passed to record a positive annual change from the third quarter.
However, the institution led by Teodora Cardoso said that “the impact of the measures in indirect taxes was less than expected” since “the result of execution achieved by the measures provided by the Ministry of Finance did not exceed the 66%.”
Excluding the change to the game model, which generated the expected increase in revenue (25 million), “none of the others reached the expected objective,” highlighting the CFP the end of the IMI safeguard clause, the reform of the Green Taxation and the increases of Special consumption Taxes (IEC).
the protection provided to raise 150 million euros by the end of the IMI safeguard clause, but the measure eventually pay only EUR 68 million. However, the CFP indicates that this “poor result” was offset by developments “very positive IMT”, which increased 19.5% (ie over 95 million).
In the other two cases ( Green taxation and IEC), the CFP notes that “the good performance of VAT fully settled deviations”, but stresses that the diversion of 59 million in the IEC was due to the collection of the Tobacco tax and tax on Alcohol and Alcoholic Beverages, whose collective revenue fell 0.8% compared to 2014.
As for Green Taxes, the institution writes that the contribution on plastic bags, with the Finance estimated revenues of 34 million euros, generated revenues of just one million euros, that is, “not even reached 5% of the predicted value.”
for the CFP, these examples “illustrate the economic effects of taxation, and the effect on revenue public “, in the case of taxes” whose purpose, in terms of sectoral policy is to reduce risks to the health of citizens (IT case), release of greenhouse gas effect, clogging risk in water lines and pollution rivers and oceans (if the tax on plastic bags). “
That is, note the CFP,” the reduction in the tax base caused by the increase in the rate of these taxes, although with a negative effect on government revenue revealed the effectiveness of the measure with respect to the desired change in the behavior of business and citizens “.
from the perspective of direct taxation, there was a decrease in its share of GDP, to 10.8% of GDP and, for the effective social contributions, there was a stabilization in 9% last year.
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