Rui Rio: “Portugal is one of the countries with the highest tax burden.” Truth or falsehood?
“I hear from António Costa here and what he said very clearly was: ‘Let’s go the same way continuity line.’ Therefore, António Costa’s economic policy is exactly the same as it has done since he was prime minister. (…) This whole line that was followed, which gave the results that we know, with Portugal at the tail of Europe, is the line that will continue. It is the line that says to the Portuguese: ‘I will give you a reduction in IRS now as early as next year if you have this Budget.’ But it is within the framework of a country that is one of the countries with the highest tax burden“, criticizes Rui Rio, leader of the PSD, in the debate against Antonio Costa, do PS.
Is it confirmed that Portugal “is one of the countries with the highest tax burden”?
According to the most recent statistic data of the Organization for Economic Co-operation and Development (OECD), published in December 2021, the tax burden in Portugal represents 34.8% of GDP in 2020. Thus, in that year, the tax burden in Portugal was 1.3 percentage points above average (33.5%) of all OECD countries.
Compared to 2019, Portugal recorded an increase of 0.3 percentage points. The OECD average registered a growth of 0.1 percentage points compared to the same year.
Although the country is, in fact, above the OECD average, the truth is that, in the list of 38 countries (36 with data available for 2020), Portugal occupies the 19th position. That is, more or less in the middle of the table. At the top of the table are those countries such as Denmark, Belgium, Austria, France, Finland and Sweden.
Not regarding the comparison with the Member States of the European Union, data from the Eurostat for 2019 indicate that, in that year, the tax burden in Portugal represented 36.8% of GDP, falling by two tenths compared to 2018. The country was thus far from the EU28 average (in 2019, before the Brexit), in this case and represented, 40.2% of GDP.
With 36.8% of the tax burden in GDP, Portugal occupied the 14th position of the table, behind Germany (41.7%), Austria (43.1%), Belgium (45.9%), Croatia (38.7%), Denmark (46.9%), Slovenia (37.7% ), Finland (42.3%), France (47.4%), Greece (41.9%), Holland (39.8%), Italy (42.6%), Luxembourg (40.5%) and Sweden (43.6%).
In short, neither when compared with OECD countries, in 2020, nor when compared with European Union countries, in 2019, Portugal was in a position that justifies the classification of Rio as “one of the countries with the highest tax burden”.
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