Portugal had a 0.7% GDP surplus in 2024

Portugal closed the year 2024 with a budget surplus of 0.7% of GDP in national accounting, according to the data disclosed today by the Statistics Office (INE).

According to the quarterly national accounts by institutional sector, "the positive balance of the Public Administration sector in terms of GDP percentage was 0.7% at the year-end on the 4th quarter of 2024, the same as that in the previous quarter".

The quarterly change was due to a rise in expenditure (0.9%) alike the rise in revenue (0.9%). In current revenue, the Statistics Office notes a 1.3% increase, reflecting increases in almost all of the items, except for taxes on income and estate, which dropped 2.2% due to the new income tax withholding rates.

From an expenditure side, a 2.1% rise in current expenditure was noted and an 11.1% cut in capital expenditure (subsidies on investment, and investment and acquisitions expenditure). 

According to the first notification of the Excessive Deficit Procedure, also published, the overall balance for Public Administrations was 1 994.2 billion euros.

Determining the balance according to the national accounting rules includes technical adjustments such as payment of expenses on previous years and other extraordinary effects. Among the main factors we have: 117 million euros associated with converting deferred taxes on assets from Novo Banco in refundable tax credit; the ruling by the Supreme Administrative Court that determined the payment of 227.6 million euros to EDP; and the additional allocation of 200 million euros to the National Electricity System (SEN) to cut electricity tariffs.

The primary balance, which represents the global balance minus interest expenditure was positive, albeit with a 904-million-euro difference compared to 2023.