State Budget 2019: what we know already

  • ECO News
  • 15 October 2018

The government will deliver this Monday the final proposal for the State Budget 2019 (OE2019). Retirement fund increases and the revision of early retirement schemes are some of the expected changes.

This Monday, the government will deliver in the Parliament the final proposal for the State budget of 2019, and the general voting and discussion round is planned for the 29th and 30th of October, while the final voting is scheduled for the 29th of November.

Several measures are already known, but they can be changed during the round of debates. The macroeconomic landscape was presented y the minister of Finances, to the political parties, last week.

According to the information given by the political parties, the budget proposal is predicting a GDP growth of 2.2% for next year, a 0.2% deficit, and an unemployment rate of 6.3% and a reduction of public debt to 117% of GDP.

These are some of the main measures which should be part of the State Budget 2019:

  1. 50% cut on the tax return for emigrants
  2. Reinforcement of culture and science funding programmes
  3. Increasing pensions/retirement funds
  4. Review of the early retirement schemes
  5. End of the mandatory retirement at age 70 as a state employee
  6. Special careers (nurses, prison guards, policemen, gendarmerie, professors): work time will be taken into account
  7. Increases for government employees’ wages
  8. Phased career progression
  9. 1000 qualified workers to be employed for the public sector
  10. Reduction of electricity by 5%
  11. Sugary drinks might pay more taxes
  12. Municipal Property Tax (IMI) might have an extra (additional tax), taking in to account the sum of patrimony in Portuguese territory
  13.  IMI can be paid in three instalments
  14. IRS (tax return) ranges will be updated
  15. IRS can be delivered until the 30th of June (extension of the delivery period)
  16. Changes in supplementary tax withholdings (i.e., for extra hours, the IRS might be reduced)
  17. Car taxes will be updated (tax exemptions in line with the new WLTP system, Worldwide Harmonized Light Vehicles Test Procedure)
  18. PEC (advance tax) might not be compulsory
  19. Plastic bag prices will go up by 12 cents
  20. Credit for consumption will be penalized, with a stamp duty increase
  21. Ballet dancing becomes an exacting career, and shows will have a tax reduction
  22. University fees will go down to €856
  23. Support to long duration unemployment (for people over 52 years-old)
  24. Investment in health, education and transports