Portugal seems to have had, since ancient times, some aversion to doing math. Or, at least, to consider quantitative data to formulate policies.
However, information has never come at the expense of accuracy and this is essential to know where we are and where we are heading.
I know that it’s easier to ride the news of the moment. Be it the enthusiasm that momentary news brings us, or the depression that reality induces in us. Between the “economy of the year”, the two million poor people we know we have and the homeless people we see in our cities, there is a distance that economic science can explain but that citizenship will have difficulty in assuming.
AI tells us that GDP measures the total value of all goods and services produced by a country in a given period. In the Portuguese case we will be talking about 290,000 million euros per year.
I leave the following quantitative data for readers to reflect on:
– The debt of public administrations, companies and individuals, is, according to the Bank of Portugal, 848,200 million euros, ie, three times the GDP.
But,
– Social Security credits due and not collected amount to 17,000 million euros.
– Tax credits due and not collected amount to 27,000 million euros.
– Annual tax expenditure will be around 20,000 million euros.
– The total value of pending cases in the Administrative and Tax Courts, worth more than one million euros, reached, in 2024, around 19 billion euros.
– The parallel economy in Portugal has variable values, but credible studies point to around 35% of GDP, that is, around 100,000 million euros. Admitting that this parallel economy would generate, modestly, 25% of tax revenue, we would be talking about 25,000 million euros of tax revenue.
And so, in a very empirical way, although easy to understand, we can say that “there is” around a third of the GDP that the State is unable to collect, nor is it clear whether and when it will be able to do so.
We will not be a rich country, but one of spendthrifts…
If collected, these debts would reduce public debt by around a third.
We know that, in 2015, the government of the time committed to “rationalization of the State, crucial in modernizing and optimizing the functioning of Public Administration and improving the quality of public services provided”.
And we also know that, in a thunderous way, in 2025, the government told us that “it would declare war on bureaucracy, taking advantage of technological potential. Digitization, including the use of artificial intelligence, must be accelerated, ensuring the interoperability of systems and the automatic flow of information between services (such as between AT and Social Security), to reduce errors, repeated requests and context costs.”
Between reforms that don’t happen and declarations that are of little value, citizens would live better if the State were able to collect debts from deadbeats, reduce the parallel economy and make the courts work. It won’t be a lot of ambition, not even an “eye-candy” ambition. But it would certainly be very relevant for those who honorably pay their taxes.
More efficiency and effectiveness are needed. Also to give strength to democracy.
Lawyer and manager