Portugal's debt financing costs are set to rise by 1.4 billion euros in the upcoming state budget due to higher interest rates across Europe. This represents the sharpest year-on-year increase in debt-servicing expenses since the period of the international financial assistance program (Troika).
This update is from Bica
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The IRS Jovem (Youth IRS) tax scheme is set to become the most expensive tax benefit for the Portuguese state in 2027, with an estimated effective cost exceeding one billion euros. This figure excludes 'theoretical' tax breaks, highlighting the significant fiscal weight of the measure as it currently stands.
The government is set to present its State Budget proposal next week, which reportedly relies on optimistic economic forecasts despite ongoing pressures from the cost of living and current interest rate levels.
68% of respondents in Portugal state that their purchasing power fell significantly over the past 12 months due to rising prices for natural gas, electricity, fuel, and heating oil, placing Portugal 7th highest in the EU and above the 60% European average. Additionally, 65% of respondents in Portugal report altering their driving habits to save fuel, and 85% consider the energy transition urgent for the country.