The Portuguese government will propose a new reduction of IRS rates up to the sixth bracket, with retroactive effects from January 2026. This measure represents a continuation of the tax reduction policy that has been implemented over the past year.
Taxpayers will feel the impact of this reduction in November's source withholdings and also in the Christmas subsidy, which will be calculated with the new rates. This means that salaries and pensions to be received in the coming months will be affected by this fiscal change.
Luís Montenegro also announced an extraordinary supplement for pensioners, which will be paid in December. This measure is specifically aimed at supporting citizens who receive pensions, in a context of pressure on the cost of living.
All these measures are expected to be approved and implemented at the next Council of Ministers meeting, where the executive will formalize the proposed fiscal changes and support for pensioners.
