The CDS-PP Madeira has said the legal margin to reduce the region's reduced VAT rate further is exhausted under the current framework.
Party spokesman Vasco Marcial recalled that the reduced rate fell from 5% to 4% from 1 October 2024, using up the maximum 30% differential allowed. The party demands a revision of the Regional Finance Law so Madeira can offset the costs of insularity without compromising regional public services.
The party rejects proposals to apply a 30% cut across all VAT brackets, arguing it would be financially unsustainable. It notes that the 2026 Regional Budget includes 222 million euros in tax relief measures.