Pandemic cost Portugal 2,316 ME until July

in News · 30-08-2020 12:00:00 · 1 Comments
Pandemic cost Portugal 2,316 ME until July

The Covid-19 pandemic cost the state 2,316 million Euros (ME) until the end of July, due to revenue shortfalls of 672.1 ME and expenditure increases of 1,643.9 ME, the Directorate-General for the Budget (DGO) announced.

"By July, the execution of the measures adopted in the fight against and prevention of Covid-19, as well as those aimed at restoring normality, led to a reduction in revenue of 672.1 ME and an increase in expenditure of 1,643.9 ME," can be read in the Summary of Budget Execution released by the DGO.

The amount recorded up to July related to the Covid-19 pandemic is less than the 3,774 million Euros of losses related to the increase in expenditure and reduction in revenue recorded up to June.

"On the revenue side, it is worth mentioning the tax payment extensions, to be paid from the 2nd semester onwards, for a period of up to six months (379.3 million Euros for VAT and 122.9 million Euros for withholding taxes and IRC) and the suspension of payment of instalment plans and tax execution processes (99.4 million Euros)", indicates the DGO in its summary.

In the table that accompanies the synthesis, the DGO details that the extension of the withholding tax of IRC and IRS generated a loss of 122.9 ME, the extension of the payment of VAT of 379.3 ME, the suspension of the payment of instalment plans and processes of contributory execution 99.4 ME and other items 68.5 ME.

According to the DGO, the largest slice of expenditure related to the Covid-19 pandemic was dedicated to the 'lay-off', which cost 751.8 ME, followed by personal protective equipment (PPE), medicines and other health items (251.8 ME), the extraordinary support for the reduction of economic activity of self-employed workers (137.2 ME) and other items (114.7 ME).

Next, in the list of expenses below 100 million Euros the exceptional support to families (82.9 ME), ventilators and other equipment dedicated to the National Health Service (52.2 ME), the stabilisation complement for workers who were in 'lay-off' (48.3 ME), EPI, adaptation of workplaces, cleaning products and services (37.8 ME), human resources, including hiring, overtime and other allowances (34.3 ME), prophylactic isolation (31.8 ME), extension of unemployment social benefit (31.8 ME) and support to companies under the Adaptar programme (24.3 ME).

In the expenditure with financial assets are still the line of support to tourism for microenterprises, to the value of 44.5 million Euros, and other items, accounted for 0.4 million Euros.

The DGO points out that "in the absence of expenses associated with the measures under Covid-19, the effective expenditure of the Public Administrations would have grown 2.1 percent compared to the same period of the previous year (instead of 5.3 percent) and the effective revenue would have decreased 9.1 percent (instead of 10.5 percent)".

The deficit of the Portuguese public accounts worsened by 7,853 million Euros until July, reaching 8,332 million Euros (ME), disclosed the Ministry of Finance, in a statement.

"The budget execution in public accounts of the Public Administrations (AP) registered until July a deficit of 8,332 ME, a worsening as a result of the pandemic of 7,853 ME compared to the same period of the previous year due to the combined effect of contraction of revenue (-10.5 percent) and growth of expenditure (5.3 percent)", can be read in the Finance Communiqué that precedes the Budgetary Execution Summary of the Directorate General of the Budget (DGO).


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Covid-19 has just brought forward the changes to the business and financial sector which are needed to slow climate change

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