This paper reports on a simple exercise in the long-term sustainability of public finances. In particular, focusing on Portugal, it assesses the impact that an ageing population is expected to have on public pension expenditure over the next fifty years. We carry out such an exercise in...

Pereira and Rodrigues discuss tax reform in Portugal on the basis of a dynamic general equilibrium model where the tax system influences long-term growth through its effects on the demand for capital and labor. The model is simulated by implementing the tax reform package proposed in 1999 by a...

This paper provides an overview of what economists know, or what they think they know about the effects of government deficits and debt on economic performance. It starts by introducing the government's budget constraint and proceeds to address the possible justifications for the issuance of...

In the second of two twin papers, we focus on direct taxes and formally discuss the correspondences between statutory and effective tax rates in the Portuguese economy. These correspondences depend on the details of the Portuguese tax law, on a wealth of data information, and on certain priors...

In 1999, Cavaco Silva, the Portuguese Prime Minister from 1985 to 1995, proposed a comprehensive tax reform package, which is to this day the basic reference in the tax policy debate in Portugal. A tax shock would consist of 4pp cuts in the corporate income tax and in the firms social security...