Lisbon, Sept. 30, 2024 (Lusa) - The president of Portugal's business confederation CIP on Monday accused the leader of the opposition Socialist Party (PS) of being "radically’ against lowering corporate income tax, and the minister of agriculture considered Pedro Nuno Santos's" thinking to be that of a “radical” close to the extreme left.
The opening of the FIPA Congress - Federation of Portuguese Agri-Food Industries, on Monday in Lisbon, was attended by the minister of agriculture, José Manuel Fernandes, and the president of CIP - Confederação Empresarial de Portugal, Armindo Monteiro, who shared the idea that the secretary-general of the PS, Pedro Nuno Santos, is a radical when it comes to Corporate Income Tax (IRC).
"CIP doesn't get involved in party discussions, but it worries me when the leader of a party establishes as a guiding principle of his programme base that he is radically against lowering corporate tax," said Armindo Monteiro in his speech.
The president of CIP said that more than the cost, it's a question of supporting companies, valuing them and defending this tax reduction.
"It's impossible to reconcile the principle of "we support companies" with being radically opposed to reducing their taxation in any way," added the president of the employers’ confederation.
The next speaker was the minister for agriculture and fisheries, who shared the idea of radicalism.
"Fortunately, we have a prime minister [Luís Montenegro, PSD] who knows Portugal, is highly prepared and is not conditioned by radicalism. I apologise, but anyone who thinks that the IRC can't be lowered when it's high is clearly a radical who is closer to what I call left-wing radicals and extremists and who is not moderate," said José Manuel Fernandes.
The PS secretary-general, Pedro Nuno Santos, has said that he rejects the budget for 2025 with the changes to personal and company income tax proposed by the government and that he doesn't accept "any modelling" of these same measures because they "are bad’ and even that wouldn't make them good.
According to their leader, the Socialists cannot accept "two measures that would have a structural and permanent impact."
The government advocates a gradual reduction in corporate income tax from 21% to 15% by the end of the parliamentary term.
Still on the subject of the budget for 2025 and the discussions surrounding its viability, Armindo Monteiro considered the possibility of the country being governed in twelfths to be "very worrying" but said it was "even worse to have to bring forward elections".
"[Both situations] would create an unfavourable environment for overcoming Portugal"s challenges," he said.
Regarding wage rises, the president of CIP said that companies want to increase their wages but that to do so, they need to create more wealth, be more competitive, and be more productive.
"We can't continue with this sort of Portuguese economic miracle of distributing what we don't create. It's important that we create first," he said, arguing that an excessively expansionist wage policy could have perverse effects, such as job destruction.
The proposed budget for 2025 must be submitted to parliament by 10 October, and its approval is still uncertain. The PSD and CDS-PP (the parties that support the government) have 80 MPs, which is not enough to ensure that the document is passed.
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