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Tax Policy Measures Of The IMF/ECB/EC Memorandum Of Understanding
A Memorandum of Understanding ("MoU") between the joint task force of the IMF/ECB/EC and the Portuguese government has been released. The MoU outlines a EUR 78 billion loan facility, as well as several economic and tax measures which are to be adopted in the next three years. Taxand Portugal examines the noteworthy tax measures of this economic and financial policy document.
The main proposed areas of intervention together with the broad themes include:
- Corporate Tax - broadening of the tax base
- Personal Income Tax - curbing existing benefits and tax credits with the objective of imposing a more neutral tax regime
- Indirect Tax and Property Tax - limiting the extensive use of reduced VAT rates and extend the scope of application of the VAT standard rate, thereby inducing a shift on the taxation from employers' social security contributions (lowered) to consumption and property taxes
- Tax Administration and Tax Courts - this will bring further responsibilities to the tax authorities, which may have a positive effect on reducing bureaucracy and increasing effectiveness on administrative appeals
It is advised that multinationals are familiar with the MoU and its implications by seeking the necessary advise to ensure they are complaint at all times.
Your Taxand contact for further queries is:
Fernando Castro Silva
T. + 351 21 382 12 00