Portugal's parliament rejects budget, snap election looms in 2022

Portugal's Prime Minister Antonio Costa gestures at the end of the debate on the 2022 state budget draft in first reading at the Portuguese Parliament in Lisbon, Portugal, October 27, 2021. REUTERS/Pedro Nunes

LISBON (Reuters) -Portugal's parliament threw out the minority Socialist government's 2022 budget bill on Wednesday, paving the way for snap elections and ending six years of relative political stability under Prime Minister Antonio Costa.

Costa's hard-left former allies sided with the conservatives to defeat the bill that envisaged income tax cuts for the middle class and increased public investment while cutting the deficit to 3.2% of gross domestic product from 4.3% in 2021.