LISBON, Sept 13 (Reuters) - Portugal’s main opposition Socialists threatened on Thursday to put an end to a cross-party backing for an EU/IMF bailout and said they would vote against the 2013 draft budget if the government insists on new tax hikes.
Although the ruling centre-right coalition has the necessary majority in parliament, Berlin and Brussels have particularly praised the wide political consensus in Portugal behind austerity needed to attain the fiscal goals of the 78-billion-euro bailout.
“The government has failed all around and wants to repeat the error next year in a harsher dose,” Socialist leader Antonio Jose Seguro said in a televised statement. “I decided that the party should vote against the budget,” he said, adding that the party would also consider a no-confidence motion in the government.
Last Friday’s decision by the government to raise social security contributions by all workers to 18 percent from 11 percent in 2013 has been heavily criticised by labour unions, business leaders and even members of the ruling coalition.
Criticism of the tax hikes from unions and opposition parties grew louder this week after the country’s lenders, European Union and IMF said they had agreed to ease the country’s fiscal goals under the bailout.