Funchal, Madeira, Portugal, May 7, 2025 (Lusa) - The Finance Secretary in Portugal's archipelago of Madeira regional government said on Wednesday that the government will continue to gradually reduce taxes in order to ensure that families have more disposable income and companies can compete in a more global economy.
Pointing out that the autonomous region has had "good budget results for 12 years", Duarte Freitas emphasised that this has allowed the Madeiran government to "continue to engage, in a responsible and sustained manner, in tax relief in the areas of personal income tax (IRS), corporate income tax (IRC), municipal surcharge (derrama) and VAT".
The minister was speaking during the sectoral discussion of the Programme of the 16th Government of Madeira (PSD/CDS-PP), for the period 2025-2029, which began on Tuesday and ends on Thursday, with approval guaranteed due to the absolute majority formed by the Social Democrats and Christian Democrats coalition.
During the debate, Duarte Freitas was asked several times by the opposition about which taxes will be reduced and when, as well as about the withholding tax rates for self-employed workers, but the minister didn't give a concrete answer.
The secretary of finance only stated that Madeirans can count on "a trend of tax relief as before, with gradualism, realism and prudence".
Duarte Freitas emphasised that it is the executive's intention to lower VAT, but insisted that in order to do so it is necessary to complete the process of revising the Regional Finance Law and apply the public capitation method so that regional revenues are not jeopardised.
"In tax matters, the essential lines of intervention are therefore defined as more justice and greater fiscal autonomy and, finally, more international competitiveness," he emphasised.
The minister also spoke of realising a tax system of his own, but when asked by the sole MP for IL, Gonçalo Maia Camelo, about ‘the main lines’, he didn't specify what this tax system would consist of.
The finance secretary also guaranteed that the regional government would champion Madeira's International Business Centre before European bodies, "providing it with conditions that boost tax competitiveness and investment attractiveness", as well as promoting the diversification of the economy, giving as an example the growth of the International Shipping Register.
On the other hand, Duarte Freitas promised that in the context of institutional relations with the mainland, "despite its tolerant attitude and willingness to engage in dialogue, it will not cease to demand compliance with promises made to the entire population and, above all, what the people of Madeira and Porto Santo are entitled to".
For the minister, this government programme is based on "renewed priorities and objectives" and "points to the continuity of the development process demanded" by the Madeiran population.
JPP MP Luís Martins asked the regional secretary for a timetable for the tax cuts and what the concrete objective would be in terms of reducing public debt by the end of the year, but received no reply.
The MP from the largest opposition party in the chamber also warned that the autonomous region has not yet exhausted the tax differential it can apply, namely from the 6th IRS bracket and in VAT.
For the PS, Gonçalo Leite Velho, pointed out that the regional government's spending had increased while it was in office, questioning how the executive " is spending more than when it had a budget".
In response, Social Democrat MP Bricio Araújo said that he found it strange that the Socialist should evaluate a government that was in caretaker mode, "especially when it was put in this position by the responsibility and the foolishness of the Socialist Party, which aligned itself with Chega" in the motion of censure presented by that party.
Meanwhile, Chega MP Miguel Castro called on the head of the Finance portfolio to implement a tax reduction, particularly in relation to VAT, and criticised the fact that the executive continues not to apply the tax differential allowed in all taxes.
The PSD/CDS-PP coalition government, which emerged from early elections on 23 March, has an absolute majority in parliament, with 23 Social Democrat MPs and one Christian Democrat, out of a total of 47 in the chamber.
In addition to the PSD and CDS-PP, Madeira's parliament has 11 MPs from the JPP, eight from the PS, three from Chega and one from IL.
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