Also as a Portuguese I consider this article literally fake news/propaganda.
If so, that seems literally insane to me. Why wouldn't Portugal fix this?
Still silly, but not insane.
With the exception of a few notable oil economy countries that have sovereign wealth funds, federal governments most certaily do not invest tax revenue in the market. Taxes are used to finance the running of the country. If governments are lucky something is left over paying its' bills and the government runs a surplus.
Please provide a citation that Portugal invest its' citizen's tax revenues in the financial markets and makes a profit from those.
>"If they did it the other way they'd have to raise the tax rates to compensate, which wouldn't go down for the politicians doing it, even if the net result is the same."
Umm no if they did it the other way around the government could additionally tax people's gains from investments, and people could save for things like their retirement at the same time.
What "they" said was:
>"that is money the government is investing and earning a return on."
"Investing money and earning a return on it" is universally understood to mean putting your money to work in the financial markets. Your comment is disingenuous at best.
Further governments don't earn a "return" when they spend money on a stoplight or a bridge. Infrastructure requires upkeep, maintenance and eventual replacement.
It's a coast center not a profit center. If it was the latter governments would be building infrastructure like crazy and running a budget surplus. And that clearly isn't the case is it?
You have the right to your opinion, but changing words meaning is taking it a bit far.
In the context of a government or any other large institution this is most certainly understood to mean the financial markets. That is not "opinion" but rather common understanding in English language business parlance.
You have resorted to cherry picking words and trying to play semantic games. You have added exactly nothing to the conversation. In fact it's worse as resorting to "that's just your opinion" type remarks just degrades the level discourse. It's just slightly above name calling.
In all countries I know of, tax withholding is not a perfect match to final tax bill, and that could amount to a no-interest loan to government like you say. Not sure if in practice that loan is unusually large in Portugal, could be.
However, in order to minimize the amount due in August, the government captures an estimate of your income tax every month (before you get paid).
It is this estimate that is designed to be simple, and applies deductibles to the whole salary. There's no harm: If it happens to capture too much, you'll see your money back next August.
Under the progressive system, there are no surprises or delays, what I paid that month is exactly what I owe.
Like another poster said, effectively an interest free loan to the government from taxpayers.
What am I missing?
Simplicity and personal data protection. In order to capture tax in advance with perfect estimates, employers would need to know your total income and deductible expenses. With the simplistic system, they just need to know how much they're paying you.
Health system is completely broken the public Hospitals don't have enough resources or money to threat the patients with dignity, people still live with very low salaries and high prices of goods, The industry is still very weak unlike its mentioned in the article etc.. etc...
Honestly seeing these articles makes me really sad.
No need to be so dramatic. Compared with countries with a similar economy, our system is objectively very good. Independent reports will back me up.