Portugal Unveils New Budget, Braces for Protests - WSJ.com
High taxes on individuals sap the capital necessary to keep a business alive - and, clearly those with higher incomes will look to leave the country or not recognize income.
There is no growth component except if a multi-national company (i.e. the owners aren't in Portugal) decide the cost of private labor is low enough (although motivation is questionable). However, Portugal has to compete with other countries with low cost and motivateable labor; and, bottom line, someone has to manage a business and they need to have a good lifestyle. This is not helped by the new proposals.
Clearly the budget and government policies are being directed by people on the upper deck of the ship without a clue to the fact that they are starving those down below and not providing them with the means to fix the major leaks.
There is no leadership with an eye to growth.
If the money goes to government and is taken from the pockets of workers, investors and business people, then there is nothing left to fund the actual work of the economy.
People I know in Portugal talk of all the multi-nationals pulling their expat employees out of Portugal. They are focusing their business away from Portugal. Very sad.
The government is pouring salt into the wound instead of dressing and cleaning it.
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