Salaries from €3,000 get IRS relief of over €200

A new IRS cut proposed by the Government will result in annual savings that could exceed €400 compared to the current tax brackets.

Proposed reductions range from 0.4 percentage points (pp) to 0.6 pp in the first eight brackets as early as August.

For gross income between €1,200 and €6,000, between the 3rd and 7th brackets, relief varies between €62 and €414.

The bonus exceeds €200 for salaries from €3,000 in the 5th bracket according to simulations from tax consultants EY.

With the new IRS rates proposed by the new government, Portuguese families will have more net income in 2025. This saving is in addition to the one that is already being felt with the changes introduced last year and in the 2025 State Budget – the so-called double benefit.

According to the Government’s proposal submitted to the Assembly of the Republic, the reduction is 0.5 percentage points (pp) between the first and third brackets, 0.6 pp between the fourth and sixth, and 0.4 pp in the seventh and eighth brackets.

The additional reduction in IRS includes an overall reduction of €500 million with savings of up to €414 compared to the provisions of the State Budget and has retroactive effects to January of this year.

The Executive of Montenegro intends to reduce IRS rates as early as August to increase consumption in the summer, with the Government fearing a slowdown in the economy.