News / EU

Portugal’s premier under increasing fire over tax scandal

Friday, 06 March 2015 10:27 PM [ Last Update: Friday, 06 March 2015 10:38 PM ]

Portuguese Prime Minister Pedro Passos Coelho in Brussels on December 18, 2014

Portuguese Prime Minister Pedro Passos Coelho has come under increasing pressure for failing to pay his own taxes on time.

On Friday, Portugal's main opposition party took aim at center-right premier over a media report that he failed to pay his social security contributions for five years.

Socialist party heavyweight and former presidential candidate Manuel Alegre said that Coelho’s “ethical and political obligation” is to resign over the tax scandal.

Socialist leader António Costa Coelho also said that the premier had “used and abused his political immunity” to dodge questions.

Opposition parties say that in other countries such lapses would be grounds for resignation.

The developments came after Coelho admitted that he was one of those who did not always comply with his tax obligations.

The premier said in a statement on Friday that some years he filed his tax return late, "sometimes because I forgot, sometimes because I had no money." The premier says he later paid outstanding sums and financial penalties.

A Portuguese newspaper revealed last weekend that he failed to pay almost €4,000 in social security from 1999-2004.

The center-right coalition government leader also faces growing pressure to fully explain why he failed to declare earnings between 2003 and 2007, when he was a consultant for various companies.

Some senior members within the premier's ruling Social Democratic Party say Coelho had been the victim of administrative errors.

Coelho's administration launched a crackdown on tax evasion as part of an austerity program when it took power in 2011.

Battered by the global financial downturn, the Portuguese economy fell into a recession, which compelled the country to negotiate with the International Monetary Fund and the European Union for a bailout loan in 2011.

In return for the bailout, the Portuguese government had to impose a number of austerity measures, including more public spending cuts and tax rises, as required by the terms of the international bailout loan.

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