Government says it will create tax incentives for investment in shares and debt of Portuguese companies

The State Secretary of the Treasury and Finance said this Thursday that the government will create tax incentives for investments in shares and debt of Portuguese companies, but did not specify how it will do this and when they will be implemented in practice.

At the opening of the annual conference of the Securities Market Commission (CMVM), João Silva Lopez spoke about the government program (PSD/CDS-PP, which took office at the beginning of April) and said that the executive branch will provide favorable conditions, including of a fiscal nature, to investments in the capital market.

Among the measures, he said, he would strengthen tax incentives for investors who invest in the debt and shares of Portuguese companies, and create incentives for Portuguese companies to go public.

He also said he would create tax regimes favorable to innovative companies, research and development and internationalization.

On the sidelines of the event, when asked when the detailed measures would be put into practice, a government official declined to make a statement to journalists.

However, in his speech, João Silva Lopes noted that the main problem of the Portuguese economy is the “anemic growth” of the last 25 years due to a lack of competitiveness and productivity, and that without further growth “there will be no better wages.” .

The opening of the conference entitled “Digital, Energy, Demographic Transformation – The Role of the Capital Market” was the responsibility of the President of the Securities Market Commission (CMVM), Luis Laguinha de Souza, who believed that, despite the shortcomings, there is still no other better system, than the capital market, which “brings together benefits for both companies and investors” and that Portugal’s challenge is how to develop this market.

Laguinha de Souza also cited a recent CMVM study that found equity markets “are a competitive alternative to long-term savings.”

The study looks at 25 years (1996-2021) and concludes that the net return (after fees, taxes and inflation) from investing money will be higher in funds that replicate the Geral PSI index than in bank deposits and government debt.

Laguinha de Souza also believes that “returns could be more significant if the PSI index included highly dynamic sectors.” [da economia portuguesa] which, unfortunately, are not represented.”