Government presents plan B to partners: PEC
The Portuguese PM has presented to social partners the alternative to the TSU decrease, the decree law that was voted down in Parliament this Wednesday: PEC (Special Payment on Account).
This Wednesday, António Costa, the Portuguese prime minister, informed social partners he has a proposal to change the Special Payment on Account (PEC). That proposal should be presented soon, and the common belief is that it will be a decrease of the minimum limit. However, Arménio Carlos, CGTP’s secretary general, confirmed to ECO that the change in the PEC regime does not include a new agreement with the social concertation.
“Up until now, the proposal on the table concerned the Single Social Tax [TSU]. Except the TSU would not only benefit micro and small enterprises, it would benefit many others as is, in fact, plausible. For this particular case, PEC may benefit micro and small business owners in a more specific way”, argued the leader of CGTP (General Confederation of Portuguese Workers), in statements made to ECO. However, they await the final document: “It’s like a dessert – we only know how sweet it is after we taste it”.
"If the Special Payment on Account [PEC] is altered, as you can understand, it will not be to increase it. At the very least, it will be reduced. ”
The CGTP left the meeting without knowing when the proposal will be presented. Since the 0.75 percentage points’ decrease in the TSU approved in 2016 will only be applicable until January 31, the Government must promptly present a new decree law if they want to compensate employers. Nonetheless, if they choose to reduce or eliminate PEC, we must take into consideration that only in March will companies pay the first part of PEC.
To ECO, Arménio Carlos emphasized this proposal “does not aim to replace the Single Social Tax, nor compensate for the national minimum wage; it is a proposal that aims to answers the needs of micro and small business owners”. The leader of CGTP added: “If the Special Payment on Account [PEC] is altered, as you can understand, it will not be to increase it; at the very least, it will be reduced”.
