Pedro Nuno Santos warns that the government’s fiscal and economic direction is increasingly alienating the PS

This Friday, the PS general secretary considered the government’s economic policy to be wrong and warned that the proposed fiscal strategy, namely the projected reduction of the IRC, is increasingly alienating the Socialists on budgetary issues.

These positions were outlined by Pedro Nuno Santos in statements to journalists after visiting Almadesign in Paço de Arcos, municipality of Oeiras, a company that offers solutions in the fields of mobility, healthcare and industrial equipment, among others.

Asked about the economic programme presented to the Council of Ministers on Thursday, the Socialist leader criticised the path chosen by the leader of the PSD/SDS-PP.

“What the government has done in recent months has greatly distanced the PS. The statements concern wrong measures that are not only costly to the public purse but will not solve the problems of the Portuguese people,” he said, referring to the projected gradual reduction of the IRC to 15% by 2027.

According to Pedro Nuno Santos, among the measures approved by the executive power, “no transformation of the Portuguese economy is envisaged.”

“And the government’s fiscal strategy divides us because it is wrong from a budgetary point of view, social justice and stimulating economic transformation, which obviously creates difficulties of understanding” at the political level, he warned, before turning to the debate that will take place from October around the proposed state budget for 2025.

“The responsibility lies with the government, which does not have an absolute majority in parliament because the Portuguese did not want to give it. Therefore, the government has to make great efforts to guarantee the sustainability of its rule. The PS does not do this. It does not want to stand aside from solving the country’s problems, but this means condemning what is wrong and not allowing what is wrong to happen, what has happened in recent months does not help anything,” he stressed.

In front of reporters, the Socialist Party’s general secretary also spoke of the “importance of a balanced public accounting” and said “this situation was left to the current government” by the previous Socialist leader.

“We have seen measures, some of which do not have the expected budgetary impact. And those that have a budgetary estimate have a significant weight and are unfair because they promote inequality and deprive the Portuguese state of the ability to meet its obligations. It costs a lot of money and it benefits only a few, a minority,” he said.

At this stage, Pedro Nuno Santos argued that “only a few very large companies will benefit from the reduction of the IRC” from 21% to 15% in 2027, which could be “harmful” at the macroeconomic level, since the country “will give rise to a significant volume of income.”

“As with the IRC, with the IRS, the government’s proposed cuts will also benefit those who earn more. Our government is moving in the wrong direction from a budgetary point of view, in the distribution of efforts. [fiscal] and in Portugal’s goal of having a developed economy. From the measures approved by the government on Thursday, we were unable to envisage any strategy for Portugal to have a more complex and diversified economy,” he added.

As an example, the PS Secretary General said that in the PSD/CDS-PP Executive Power Point, the tourism sector is expected to account for 20% of the gross domestic product (GDP).

“I have nothing against the tourism sector, which is important for the Portuguese economy, but it is something we do not need to achieve Portugal’s goal of having a more diversified economy. The measures presented on Thursday were deeply disappointing because they do not have any transformative potential,” he concluded.