Portugal increases higher tax rates

The Portuguese government plans to introduce temporary extra tax rates for high-earning companies and households to help to meet budget-deficit goals under its €78bn (£69bn) bailout, its Finance Minister Vitor Gaspar said yesterday.

The extra rate for households in the top income-tax bracket will be 2.5 per cent and for companies making more than €1.5m in taxable earnings a year, the additional rate will be 3 per cent. He also said the government would reduce public spending by 7 percentage points to 43.5 per cent of GDP by 2015 from 2010 levels, calling the cut "unprecedented".