Government and social partners meet today to criticize the implementation of the agreement signed in October

This Wednesday, the Government and the social partners will meet again in the Social Dialogue, where the employers’ confederations will demand the implementation of the agreement signed in October, namely a tax incentive to raise wages.

The medium-term agreement to increase incomes, wages and competitiveness, signed in October at the Social Concert, with the exception of the CGTP, is on the agenda of today’s meeting of the Economic and Social Council (CES) in Lisbon.

The Social Partners will continue discussions on the Compensation Fund (FCT) and IRC tax credits for companies that increase wages through collective bargaining by at least 5.1%, measures provided for in the agreement.

At the last meeting on the subject in April, the employers’ confederations once again pressed the government to clarify how the tax relief for companies, which was provided for in the state budget for 2023 (OE2023), would be applied, stressing that the measure in this form it did not has practical applications.

There was no consensus among the employers’ confederations and trade union centers on whether the measure extended to extension orders, partners said.

On the government side, the Minister of Labour, Solidarity and Social Security, Ana Méndez Godinho, said that the introduction of the tax break is still being discussed and that this will be the subject of the next meeting.

According to the OE2023 report, more than 500,000 companies will be able to take advantage of the payroll tax credit, a measure that will have a budgetary impact of 75 million euros in 2024.

The beneficiaries of the measure are companies that raise wages under an agreement that provides for a 5.1% link upgrade in 2023 (with budgetary impact in 2024).

All expenses are increased by 50%, whether it is a fixed remuneration or social contributions associated with an increase in wages.

With regard to the FCT, the employers’ confederations are demanding to know how the amounts paid into the fund, which currently exceed 640 million euros, will be returned to the companies.

The labor secretary said late last year that companies would be able to use FCT funds for training or housing support for young workers from July, requiring workers’ consent.

According to the minister, the amount in the fund corresponding to each company can be fully used within the established time frame, taking into account the capital of the company.