Portugal's Government Approves Key Economic Measures: Pension Supplements and Corporate Tax Cuts
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Portugal's Government Approves Key Economic Measures: Pension Supplements and Corporate Tax Cuts

Economy
economy
pensions
taxreform
portugal
government
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Summary:

  • Extraordinary pension supplement approved, benefiting over two million pensioners with payments up to 200 euros

  • Corporate Income Tax (IRC) to be reduced from 20% to 17% by 2028 to boost economic competitiveness

  • 400 million euros allocated for the pension supplement, avoiding long-term fiscal commitments

  • Government focuses on supporting lower-income elderly while maintaining fiscal responsibility

  • Additional measures include combating fraud in prenatal allowances and addressing housing challenges in municipalities

Portugal's Council of Ministers has greenlit significant economic proposals, including an extraordinary supplement for pensioners and a reduction in the Corporate Income Tax (IRC). These measures, announced during the State of the Nation debate, aim to bolster the economy and support the elderly.

Extraordinary Supplement for Pensioners

The government has approved a one-time extraordinary supplement for pensioners, set to benefit over two million individuals. The supplement amounts are:

  • 200 euros for pensions up to 522.22 euros;
  • 150 euros for pensions up to 1045 euros;
  • 100 euros for pensions between 1045 and 1567.50 euros.

"This supplement, paid once in September alongside the regular pension, targets over 90% of pensioners, emphasizing support for those with lower incomes," stated the Minister of State and Finance. This initiative, costing 400 million euros in 2025, is designed to provide immediate relief without creating long-term fiscal burdens.

Corporate Income Tax Reduction

In a move to enhance competitiveness, the government has also approved a phased reduction of the IRC:

  • From 20% in 2025 to 19% in 2026, gradually decreasing to 17% by 2028.

"This reduction is crucial for Portugal's economic competitiveness, especially when compared to our direct competitors," the Minister emphasized, highlighting the government's commitment to fostering investment.

Additional Measures

The Council also addressed the regulation of prenatal family allowances to combat fraud and expressed readiness to collaborate with municipalities on housing issues, particularly in areas like Loures, where illegal constructions pose significant challenges.

Miranda Sarmento at the Council of Ministers

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