Thursday, 8 October 2026

Finance Minister Joaquim Miranda Sarmento is set to deliver the 2027 State Budget (Orçamento do Estado) proposal to parliament, featuring personal income tax (Imposto sobre o Rendimento de Pessoas Singulares or IRS) bracket adjustments indexed to inflation. The proposal includes a minimum €60.52 salary raise for civil servants (funcionários públicos) and an increase to the Solidarity Supplement for the Elderly (Complemento Solidário para Idosos). Initial parliamentary passage is expected after the Socialist Party (Partido Socialista or PS) announced plans to abstain.

New short-term rental (Alojamento Local) registrations in Porto grew five times faster than in Lisbon this year, according to industry data presented at the National Local Accommodation Summit in Porto. National tourism figures show total registered holiday rental units reached approximately 118,000, up 14% from 2022. Industry representatives dismissed claims that holiday rentals drive the national housing crisis, while former Labour Minister Ana Mendes Godinho suggested adapting tourism support programs to stimulate long-term housing.

Update: Former Minister to Coordinate Local Accommodation White Paper

Former Economy Minister Manuel Caldeira Cabral was appointed to coordinate Portugal's first White Paper on Local Accommodation (Livro Branco do Alojamento Local), scheduled for release by May 2027. The project will collect contributions from universities and sector representatives through late 2026, with Manuel Caldeira Cabral stating that short-term rentals are not solely responsible for broader national housing pressures.

The European Court of Auditors (Tribunal de Contas Europeu) identified a single suspected fraud case in Portugal out of 17 cases flagged across the bloc in its 2025 European Union budget review. The case involves an unnamed company and €755,000, including €391,000 received through the Portugal 2020 funding program. João Leão, Portugal's representative on the court and a former finance minister, confirmed that auditors found no compliance failures regarding the country's post-pandemic recovery and resilience funds.

Workplace stress, anxiety, and burnout cost Portuguese businesses up to €13.3 billion annually in lost productivity, according to the Order of Portuguese Psychologists (Ordem dos Psicólogos Portugueses). Lost work time attributed to mental health conditions has quadrupled since 2020, with employees losing an average of 40 days of productivity each year through absenteeism and reduced efficiency. The professional body reported that small and medium-sized enterprises absorb most of the financial impact, while targeted workplace prevention could save employers nearly €4 billion each year.

The Socialist Party (Partido Socialista or PS) confirmed it will abstain during the parliamentary vote on the 2027 State Budget (Orçamento do Estado), allowing the bill to pass. Socialist parliamentary leader André Moz Caldas said the party wants to prevent a political crisis and ensure the state avoids operating under emergency monthly twelfths (duodécimos) in January 2027. The leadership stated it would only change its stance if unexpected measures appear in the final proposal.

Update: Carneiro Reaffirms Budget Abstention Ahead of National Commission Meeting

Socialist Party Secretary-General José Luís Carneiro reiterated that the party will maintain its abstention on the budget proposal to keep the country from falling into political instability. José Luís Carneiro said he expects no surprises from the government and warned that pension cuts or tax increases would remain unacceptable. The PS National Commission (Comissão Nacional) will convene in Lisbon on Saturday to formally assess the decision.

Patients admitted with urgent yellow triage wristbands (pulseira amarela) faced emergency room wait times of up to 14 hours at Amadora-Sintra Hospital due to medical staffing shortages. More than 60 urgent patients were waiting for doctor consultations on Wednesday afternoon, far exceeding the recommended one-hour target. The delays also stranded volunteer firefighters (bombeiros voluntários), leaving ambulances held outside the facility for hours while waiting to transfer incoming patients.

The São José Local Health Unit (Unidade Local de Saúde de São José) in Lisbon hired 137 nurses between July and early October to reinforce hospital frontline care. The newly recruited nursing staff were deployed to high-pressure departments, including intensive care units, surgical operating rooms, and emergency services. Hospital officials said the additions help address critical staffing needs across the public medical facility.

A proposed reduction in personal income tax (Imposto sobre o Rendimento de Pessoas Singulares or IRS) rates up to the sixth tax bracket will cost roughly €400 million without affecting the 2027 State Budget (Orçamento do Estado). The government structured the tax cuts so the treasury absorbs the cost during 2026 by adjusting withholding tax (retenção na fonte) tables for November and December salaries. Parliament is scheduled to debate the measure this week.

Update: Finance Minister Confirms Further Income Tax Adjustments for 2027

During the parliamentary debate on the 2026 tax proposal, Minister of State and Finance Joaquim Miranda Sarmento confirmed that the upcoming 2027 State Budget will include an additional IRS reduction. The relief will take effect through statutory updates to income tax brackets, specific deductions (deduções específicas), and the minimum subsistence level (mínimo de existência). Joaquim Miranda Sarmento noted this adjustment marks the government's sixth income tax reduction since taking office, bringing total tax relief to €2.4 billion.

The Judicial Police (Polícia Judiciária or PJ) arrested 39 people in Portugal during Operation Hermes, a European investigation targeting a carousel tax fraud scheme involving mobile phone sales. Coordinated by the European Public Prosecutor's Office, the operation investigated €410 million in missing value-added tax (Imposto sobre o Valor Acrescentado or IVA) across eight countries, including over €150 million lost to the Portuguese state. Authorities mobilised more than 1,000 officers in Portugal, conducting 248 searches and seizing 26 properties, 84 vehicles, company shares, and luxury assets.

Mainland Portugal recorded its warmest September since 1931, driven by two successive late-summer heatwaves, according to the Portuguese Institute for Sea and Atmosphere (Instituto Português do Mar e da Atmosfera or IPMA). Average maximum temperatures reached 31.03 degrees Celsius, exceeding seasonal norms by 4.21 degrees. The weather agency also reported below-normal rainfall across most of the mainland throughout the month.

A parliamentary committee of inquiry (comissão parlamentar de inquérito) into Minister of Internal Administration Luís Neves is scheduled to be formally established on October 14. The investigation examines the minister's former tenure as national director of the Judicial Police (Polícia Judiciária). Chega leader André Ventura requested that inquiry hearings proceed during the 2027 budget debates, accusing parliamentary speaker José Pedro Aguiar-Branco of attempting to protect the minister from scrutiny.

Metropolitano de Lisboa will suspend subway service between Terreiro do Paço and Santa Apolónia starting in early November until 2028 to accommodate city drainage works. The Lisbon City Council (Câmara Municipal de Lisboa) approved an alternative surface transit plan relying on reinforced bus routes operated by Carris, rejecting proposals for a dedicated shuttle. The municipality will also pay €2.6 million in financial compensation to the metro operator during the construction period.

Portugal has raised €104.7 million through cultural investment residency permits (visto gold) since introducing the option in 2020. United States citizens represent the largest group of investors using the scheme, followed by Russian applicants. However, the cultural heritage agency Museums and Monuments of Portugal (Museus e Monumentos de Portugal) confirmed it recently rejected €2.25 million in proposed investments from Russian nationals.