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Small rises in costs, large rises in unemployment

piresdelimaThe 'fees and little taxes’ that seemed to amuse Economy Minsiter Pires de Lima, dismissing them as almost an irrelevance for Portugal’s citizens, have been analysed by Jornal de Negoçios.

The amount paid on average by each citizen in fees to the state, according to the State General Account and the General Directorate of Local Authorities, was €285 last year - hardly an insignificant sum.

These 'little taxes' have risen 18% during the adjustment programme to a total of €2.85 billion, or 1.7% of GDP.

A seemingly sober Economy Minister was talking about the new "fees and taxinhas" that Lisbon council leader António Costa is intent adding to the 2015 and 2016 municipal budget with his per night tax on tourists and a landing fee per head at Portela airport.

The largest contribution last year was from tuition fees and motorway tolls, followed by ‘processing fees and charges’ in the justice system, fees which have had the desired effect of deterring many from going to court.

If Pires de Lima looked at the tourism figures out today he perhaps would not have been so dismissive of the affect that small drops in income or small rises in costs have on the employment rate in the tourism sector.

The National Statistics Institute confirmed what the industry has been saying all along, jobs have been sacrificed due to lack of profitability, despite a rise in tourist figures.

The data released today shows that at the end of the third quarter of 2014, the food and beverage sector with the hotel industry lost a further 3.9% of its jobs - some 12,200 people.

The predictions of the Association of Hotels and Restaurants in Portugal, regarding the destruction of jobs, have come true,

"Despite the increasing number of tourists in Portugal and predictions that 2014 will be a record year, the sector continues to face serious cashflow problems and is unable to rehire the manpower it has let go," highlights the Association’s spokesman.

According to latest data, during the nine months from December 31, 2013 to September 30, 2014 there was an overall loss of 8,100 jobs despite record tourism levels. This equates to 30 jobs lost per day despite record numbers of tourists.

"Since 2011, we have been alerting the government and the public through analysis of official data and other studies which highlight the tax burden’s damaging impact on businesses. We now as a sector have depleted reserves, an accumulation of debt and heavily mortgaged assets, which invariably have resulted in business closures and redundancies," said the Association spokesman claiming that VAT rate needs to come down from a ruinous 23% to 13% just for starters.

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+2 #2 Mr Hoover 2014-11-15 08:16
Whichever way one looks at it,this is a failed Euro-State
+3 #1 Peter Booker 2014-11-14 21:27
In talking to government representatives, I fear that the Association of Hotels and Restaurants is talking to the monkey and not the organ grinder.

The government is being bolstered by the EU so long as it does what it is told. So we have the EU´s 23% VAT and motorway tolls and the sale of TAP. And government spokesmen just ignore any pertinent questions, because their machismo will not allow them to tell the truth.

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