Companies should get necessary aid at the right time

Portugal’s economy minister, António Costa Silva, said on Wednesday that he feels “neither alone nor accompanied” in the government, guaranteeing that he has “no fear” of expressing his “thoughts” so that companies receive the “necessary aid” at the “right time”.

“I am not afraid at all, neither of thinking, nor of expressing my thoughts at the times when I think I should express them. And so I did it, let’s wait and see what the developments will be”, said Costa Silva in a hearing before the Economy, Public Works, Planning and Housing Commission of the Portuguese Parliament, regarding whether or not he felt “abandoned” by the government, particularly in the most recent position he took in defence of an across-the-board reduction in corporate income tax (IRC) for companies.

“I don’t feel alone or accompanied. I have had many difficult battles in my life where I have been alone and I am also used to being proven right before my time, which is something that is sometimes very difficult to sustain,” said the minister.

Stressing that, “regardless of the parties and governments that alternate, the question of the country is the vital issue”, Costa Silva argued that it is necessary to “do everything, really everything, to help, above all, companies”.

“Because whatever we don’t do in the next few years will be paid for and paid for in a very difficult way”, he warned.

Claiming to be “perfectly calm and serene” on this issue, the economy and maritime affairs minister stressed: “I fight with the weapons I have, according to the ideas I have, in line with the government’s programme and in coordination with the prime minister. This is what moves me”.

Convinced that “the government and the prime-minister are aligned with that and are seeking the various solutions” available, Costa Silva assured that he will play his “role”: “Because I know very well the difficulties of companies that, when the time comes, do not receive the necessary aid. It pains me greatly to see companies that may go under if we don’t do everything in our power, now, to help what may happen and avoid a bigger storm in the future”, he underlined.

Recalling that he has spent “all his life working in companies”, and therefore has “a lot of sensitivity” in this matter and has “always put himself in the shoes of businesspeople and people who are in charge of companies, especially in crisis situations”, the governor noted that the economy had this year “a good performance” and will “grow around 6.5%” (driven by the base effect of a “mediocre” 2021), but warned that the worst is yet to come.

“What worries me is not 2022, it’s 2023 and what lies ahead in view of the symptoms we see in the European economy. I am a person who is always trying to think about the future and how we are going to respond,” he said.

Last week, the economy minister considered that an across-the-board cut in corporate income tax (IRC) would be beneficial, with each percentage point of the tax reduction having an impact on revenue of around 100 million euros.

However, the finance minister, Fernando Medina, later referred possible tax alterations concerning companies, namely at the level of IRC, to negotiations with social partners, revealing that he will “reserve” his position “on the matter” for the end of the negotiations.

Meanwhile, two of Costa Silva’s secretaries of state – João Neves, secretary of state for the economy, and Rita Marques, secretary of state for tourism – have also expressed positions contrary to that of the minister.

“Saying that we are going to act on IRC to solve a very short-term problem is a mistake,” said João Neves, while Rita Marques recalled that the prime minister has “the first and last” word regarding the reduction of IRC across all companies.

This issue led PSD social democrat opposition party leader, Luís Montenegro, to offer “solidarity” to the economy minister, considering that Costa Silva is being “shredded by the socialist machine” and that he was “disowned in public” by the finance minister, by “two secretaries of state, including that of the economy itself”, João Neves, and by the parliamentary leader of the ruling PS socialist party, Eurico Brilhante Dias.