More cash for Portugal Help the Current Financial Situation

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Portugal is one of the many countries, which is set to receive further funding to help them through the bailout programme. The Monetary Fund announced that Portugal is going to receive a further €1.48 billion, after the fourth review of the programme. This added money is hoped to help with the Eurozone crisis, and assist with the difficulties, which are still prevalent throughout several countries.

The progress throughout the programme has met high praise from Nemat Shafik, who believes that the Eurozone is becoming stronger. There are of course issues throughout many countries; however, Portugal remains one of the countries to continue to adjust budgets for the good of the country. Shafik remains determined that these improvements are due to the commitment of the political reforms.

If the commitment remains, progress will continue to strengthen and deepen, however, this does mean that the risks will also grow. Another factor, which needs to be considered, is the fact that the IMF made adjustments to the forecasts. The changes, which were made to the deficit forecasts, increased the debt to 114.4 percent. This indicates that Portugal will have a deficit of 118.6 percent in 2013, which is a long way to go, before the country is out of debt.

There are several different factors, which will influence the debt throughout the country, and the IMF indicated that the “process of orderly deleveraging” is reflected in the real economy. Industries such as car sales will provide a true indication of the current spending throughout the country. These figures are often used to indicate how spending trends will affect the economy.

The figures, which were released for the year on year sales throughout the continent, may have only dipped by 2.8 percent throughout June. However, the figures for Portugal crashed by 41.9 percent, which is a huge concern for the country. Another factor, which is being taken into consideration, is the amount of businesses, which did not pay tax in 2010.

As the country continues to attempt to restructure the economic issues, the Ministry of Finance continue to battle with the fact that only 29 percent of businesses paid their taxes. Only 114.865 of the huge 393,891 of corporate taxes, which were declared, provided a positive source of revenue. With so many negative issues throughout Portugal, it will be a long struggle to regain footing in the economic climate.

The measures, which are being put in place by the government, are positive; however, they are taking longer than expected. This has delayed the boost to the revenue, which was hoped to improve the financial situation throughout the country. Taxes such as the Hypermarket tax only came into effect in July. The figures for these taxes look promising; however, they have to be implemented.

All establishments that are larger than 2,000m2, or have a chain, which is collectively 6,000M 2, will now have to pay an annual fee of €4.08 during 2012. This figure will rise again in 2013 to €7, as the food sector inspections are shifted to the private sector. The funding of the €78 billion bailout which came from several different sources including a Washington based company is hoped to be enough to help Portugal.


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Published in: News and Updates / Portuguese Life