Portugal spends €600 million to reduce basic food prices

 Scrapping VAT on essential food products while also helping producers in the process will cost Portugal around €600 million, Prime Minister António Costa said after his government signed a deal with retailers and farmers in Lisbon on Monday.

The pact for the stabilisation and reduction of food prices was signed by the government, the Portuguese association of retail distribution companies (APED) and the confederation of farmers of Portugal (CAP).

“Between support for production and loss of tax revenue as a result of zero VAT, this programme has a total cost of around €600 million,” said the prime minister. (...)