The Portuguese government unveiled a substantial social support package designed to cushion families against rising prices. This package totals 2.4 billion euros and targets retirees as a primary group of beneficiaries. Prime Minister António Costa announced a one-time increase to the budget, with half of all pensions paid out in October alongside a 125-euro boost for those earning fewer than 2,700 euros gross per month. An additional 50 euros will be allotted for each child under 24 years of age. Costa stressed that, despite long-term measures already approved, these payments would be issued in a single round. (Source: Portuguese Government)
Among the measures is a reduction in the value-added tax on electricity from 13% to 6%, which will take effect next month and run through the end of 2023. The change, initially expected to pass in the Assembly, gained enough support thanks to the Socialist Party’s solid majority following January elections. The legislature is also expected to approve increases to pensions, with proposed rises of 3.53% and 4.43%. Costa noted that these increases would help sustain the Social Security system without jeopardizing deficits or debt reduction goals. (Source: Portuguese Government)
rental protection
The government also moved to curb rental increases, setting a cap of 2% for next year. This limit is well below the legal maximum of 5.7%. Landlords will be compensated through tax relief, including reductions in income tax and corporate tax, to offset the lower rent increases. In addition, public transport ticket prices will be frozen next year and extended through the end of 2022. Fuel taxes will see discounts of about 14 to 16 euros for every 50 euros of petrol and diesel purchased. (Source: Portuguese Government)
Portugal has been among the European nations announcing bold social assistance measures to counter inflation. Costa defended the package amid criticism, stating that the measures were ready as announced and that their adoption was crucial for placing the country on a secure path toward debt and deficit reduction while protecting families. He underscored that the 2.4 billion euro package was designed to deliver tangible relief to households without compromising fiscal targets. (Source: Portuguese Government)