Each of the approximately 10 million Portuguese paid 882.5 euros more to the state in taxes in 2022 than in the previous year, representing a global increase of 8825 million euros, according to Dinheiro Vivo accounts based on the report of the Technical Budget Support Unit (UTAO), delivered yesterday to the Assembly of the Republic. This evolution was mainly influenced by the larger contribution of IRC, IRS and IVA.
The analysis by Parliament’s experts of the implementation of the budget of the public administration between January and December 2022 shows that in total “revenues for the whole year increased by 11.6%, which translates into an annual nominal increase of 11 billion euros”, 4.9 percentage points above the forecast in the National Budget (6.7%).
Performance was essentially “determined by the evolution of the fiscal component, which represented 80.3% of the total increase,” according to the same document. For example, the State raised 61,879 million euros, an increase of 8,825 million euros or 16.6% compared to 2021: revenues from direct taxes (IRC and IRS) rose by 24.1% and those from indirect taxes (such as VAT or ISP) increased by 11.8% .
IRC, IRS, and IVA were the tax categories that increased tax revenue the most. Between January and December last year, the state collected 24.1% more in direct taxes, equivalent to a nominal increase of 6.8 billion euros, “providing the vitality of the IRC (57.7%) and of the IRS (12 .8%),” UTAO writes, marking the historic maximum charged by the Tax and Customs Administration in IRC: 8.1 billion euros.
Corporate income tax growth compares to the 6.9% drop in the same period last year and is strongly influenced by the end of the covid-19 policies: “extraordinary limitation of prepayments for SMEs and cooperatives, postponement of annual settlement and split payment,” the experts explain. “IRS revenues were up 12.8% compared to the same period last year, outpacing fees (9.6%), the main macroeconomic base, with some measures to support of employment that are still in place, as the new stimulus for the normalization of business activity, the Ativar program and the Commitment and Sustainable Employment measure funded by the Recovery and Resilience Plan (PRR),” the report said.
As far as indirect taxes are concerned, VAT is the main player, whose revenues increased due to inflation. “The evolution of indirect taxes was broadly positive between January and December (11.8%), driven by the economic recovery and the increase in price levels, with a deceleration trend observed from the second quarter, which also contributed to the temporary reduction of ISP,” said UTAO, concluding that “VAT is the most important tax in this category, with an accumulated year-on-year growth of 18.1%, maintaining a growth rate higher than that of private consumption “.
Poor performance of the PRR
UTAO technicians give a negative note to the expenditures made by the government under the PRR. This is due to the 3.2 billion euros expected to be spent last year, the executive branch used only 28.7% or about 918 million, “translating a slower implementation rate” in what was the first full year of implementation of the PRR was, the experts point out.
Salomé Pinto is a journalist for Dinheiro Vivo
Source: DN
