A “gradual and lasting” reduction of the tax burden on businesses and families is necessary if economic growth and budgetary consolidation are to be achieved, said the Bank of Portugal in its Autumn Economic Bulletin.
The institution led by Carlos Costa described “declining entrepreneurial investments” and their implications on economic growth in the future as a worrying factor that the government should take heed.
The Bank of Portugal said it was vital to continue the path of consolidation but always ensuring sustainable economic growth in the medium term as well as “the efficient use of resources”.
“A more efficient presence in the markets and a reduction of the tax burden are vital incentives to innovation and the incorporation of new technologies within companies, as well as to education and human capital development in the case of families, essential elements needed to achieve sustained growth,” said the Bank of Portugal.
To this end, the institution calls on the government to implement policies to “rationalise public expenditure” and consequently allow for the gradual and lasting reduction of the fiscal burden on families and companies in order to stimulate domestic consumption and investment.
