The government decided on Friday to extend the deadline for the settlement of debts to the IRS and Social Security, the so-called tax amnesty, to the end of the year.
The special scheme includes the exemption of interest payments on outstanding amounts, of administrative costs, and a reduction to 10% for fines owed.
The current tax amnesty began on November 1st and the government has managed to raise €763 million so far against a total debt to the state of €7.8 billion.
The government said that the Friday strike by tax workers in many Finanças offices had not interfered with the payment process as payments can be made online or at ATMs.
The tax amnesty was approved by the Government in October to offset the wonderfully named ‘fiscal slippage’ caused by the cost of shoring up the capital in another banking basket case, Banif.
The tax amnesty was heavily criticised by the Troika at recent reviews of Portugal's economic and financial assistance programme. The suited ones found that such amnesties could distort the incentives for tax compliance, and even an over-reliance on this sort of temporary government measures to reduce the budget defici.
