The Prime Minister of Portugal, Luís Montenegro, detailed the government's new actions to address the rising cost of living in a televised speech. This speech, broadcast on Wednesday night during the main news, particularly focused on measures related to the increase in fuel prices.
Details of the Financial Plans
Montenegro stated in this speech: "I am here to put myself at risk" and introduced a plan that includes financial payments to retirees and a reduction in income tax (IRS). These measures were announced following the government's approval after a vote of no confidence in parliament. According to the new plan, retirees with pensions less than 537 euros will receive 200 euros, those with pensions up to 1,704 euros will receive 150 euros, and individuals with pensions up to 1,611 euros will receive 100 euros. This amount will be paid in December.
Reduction in Income Tax and Support for Vulnerable Groups
The government has also approved a reduction of six IRS tax brackets. This reduction particularly helps middle-class households. Although this plan has not yet been passed as a bill in the House of Representatives, its draft has been published on the government portal. Furthermore, Montenegro referred to the increase in fuel prices and stated that the government will continue its policy of providing tax discounts on petroleum products (ISP). This discount will remain in effect until the end of the year and is expected to increase to 25 cents next week.
In this context, the government also intends to provide financial support to vulnerable sectors such as taxi drivers and farmers; for this purpose, 38 million euros have been allocated. Additionally, the supportive liquefied gas plan will continue.
The most important point in Montenegro's speech was his clear statement that the government has no intention of changing the value-added tax (VAT). Luís Montenegro said: "I do not want to reduce the tax on certain food items from 6% to zero and sacrifice the 800 million euros that we return to families." These remarks were made in light of the Socialist Party and the Chega Party (far-right) seeking a reduction in VAT.
Montenegro also emphasized that the government does not want to align its financial policies with other European countries such as Spain, France, and Italy. He stated: "I respect the choices of opposition parties and the leaders of other governments in the European Union, but I do not want to bargain our financial and economic policy with other countries."
This speech clearly reflects the challenges facing Portugal in dealing with rising living costs and fuel prices. Montenegro reiterated the importance of stability in financial policies, referencing the past and the international rescue programs that his country has undergone, stating: "Today, we cannot rely on baseless fantasies that will come at a high cost."
It seems that these plans and policies could have significant impacts on the daily lives of Portuguese citizens, especially among the middle and lower classes.
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