The Portuguese Government is under strong pressure from the European Commission to reverse the support granted to the Tax on Petroleum Products (ISP), implemented during the inflationary outbreak. Joaquim Miranda Sarmento, Minister of Finance, states that the withdrawal of this support will be done gradually from next year, taking advantage of “moments of low prices” and trying to ensure that consumers do not feel the impact.
In an interview with Jornal Económico, published this Tuesday, October 21st, Miranda Sarmento highlighted that, with the normalization of inflation, the Government has already started a “partial review” of support, especially with regard to the unfreezing of the carbon tax. “We took advantage of moments of falling oil prices in the markets, so that consumers would not feel the increase in the final price at the pump”, he explained.
With pressure from Brussels to eliminate support, the Government intends to repeat the previous strategy, starting the reversal next year. This process will be carried out “outside the State Budget” and aims to ensure that consumers are not excessively affected.
The minister also stated that current primary expenditure, which excludes specific measures and the impact of the Recovery and Resilience Plan (PRR), “has remained stable in recent years, at around 36.5% of GDP, confirming the control of permanent expenditure”. Miranda Sarmento assures that, “at the same time that we are valuing Public Administration workers and replacing the loss of purchasing power suffered with the adjustment program”, the Government is able to maintain financial stability.