Portugal’s medium term economic strategy includes provisions to raise the rate of value added tax (VAT) and social security contribution (TSU). The government also intends to decrease the extraordinary solidarity contribution (CES) on pensions.
The proposal on VAT is to increase the rate from 23 percent to 23.25 percent with effect from 2015. The revenue raised from this increase would then be committed to the pension system. The social security contribution is to rise from 11 percent to 11.2 percent from 2015. Rates of the extraordinary solidarity contribution on pensions, which applies to monthly pensions above EUR1000, will decrease in 2015, with further decreases planned for 2016 and 2017.
