The European “Fit for 55” Package and the Portuguese Tax Benefits System: Prospective Analysis and Reform Proposals

The purpose of this brief chapter is to offer a broad-spectrum analysis of the connection between environmental sustainability—under the European “fit for 55” package—and tax policy options in Portugal, particularly at the level of the existing tax benefits system. Based on the main environmental sustainability standards and principles on a European and global scale, a constructive rationale will be followed in order to analyse the tax benefit options adopted in the Portuguese tax system and possible needs for reform. The purpose is to make it more rational and efficient in a context of energy transition and the pursuit of demanding environmental goals as they ultimately derive from the Paris Agreement. The reform proposals presented will focus mainly on tax benefits applicable on personal income tax, corporate income tax, excise taxes, and property taxes.