Algarve mayors want PRR financing rules to be changed

Decision taken unanimously by the AMAL Intermunicipal Council

The Algarve mayors will ask the Government that the value of VAT is also the object of financing in the projects of the Plan of Recovery and Resilience (PRR).

This decision was unanimously taken by the Intermunicipal Council of AMAL, at its ordinary meeting in February.

Expenditure related to VAT, «according to the guidelines issued by the Structure of Mission Recover Portugal (EMRP), is considered as non-eligible, that is, it is not subject to financing, contrary to what happens in the context of other structural funds. , to which municipalities have access'.

The mayors give as an example “the European Regional Development Fund (ERDF) in which the expense related to VAT is considered eligible whenever it is shown that it is not recoverable by the beneficiary, through a certificate issued by the Tax Authority – VAT Services Directorate” .

The non-eligibility of VAT represents, for municipalities, «a substantial increase in investment expenses, without reimbursement and without the possibility of recovering, in the order of millions of euros, of projects hitherto under the responsibility of the Central Administration. Examples include Water Efficiency, the Guadiana Bridge or the Health Centers, among others», says AMAL – Comunidade Intermunicipal do Algarve.

Thus, the Intermunicipal Council will express to the Prime Minister, Minister of Finance and the National Association of Portuguese Municipalities the need to reverse this rule, so that VAT is considered eligible whenever it is shown that it is not recoverable.