Government: Tax burden news in Portugal

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An efficient state requires a smaller, younger, and better-paid public sector

Last week I discussed the importance of improving the composition of public accounts to raise the country's economic growth potential, with more public investment and a lower tax burden relative to GDP. This requires a reduction in the weight of primary current expenditure through a profound state reform. In this column, I focus on one of the components...

2027 State Budget: “Our country has already lived with a much lower tax burden than the one we have now”

With the cost of living putting pressure on household budgets, the Portuguese are looking to the 2027 State Budget for measures that will bring some relief to monthly finances. But what does the proposal foresee and what impact will it have, in practice, on family wallets? This topic was analysed by Ricardo Reis, a tax expert at Deloitte. Listen to the new episode of Economia dia a dia, a daily podcast from Expresso hosted by Juliana Simões.

The carrot and the stick in the State Budget

The carrot in the State Budget is the IRS tax cut, while the stick is hidden in the tax burden and the increase in current expenditure.

Portuguese Business Association seeks lower tax burden

Home News Portuguese Business Association seeks lower tax burden Portuguese Business Association seeks lower tax burden The Portuguese Business Association ( AEP) advocates that the 2027 State Budget include direct subsidies for activities most affected by energy costs and a 12.

Tourism employers want the 2027 State Budget to further reduce the tax burden on companies and workers

The Confederation of Tourism of Portugal (CTP) is calling for the 2027 State Budget to include a new reduction in the tax burden on businesses and individuals. Speaking to ECO, it also argues that it is urgent for the Government's proposal—which is expected to be submitted to Parliament by 12 October—to address these concerns.

Tax burden increases to 35.3% in 2025

The tax burden rose to 35.3% in 2025, compared to the 35% recorded the previous year, according to the second 2026 notification regarding the Excessive Deficit Procedure released today by the INE.

Austerity is already here

Luís Montenegro vowed to the Portuguese people that he would not be the 'father of austerity'. It is an old trick, and he masters it well. He refers to a painful past of sacrifices to try to scare people while painting himself as a responsible leader. It is never him who tightens the belt; it is always the other, the opponent, the past. He only protects. So who is tightening it? Certainly not the State. In 2025, public spending grew by 6.6% in a single year. The government promised Brussels it would curb spending growth to 5.1% by 2026, yet it will spend 5.6%. According to the European Commission, Portugal will have the second-largest deviation in the entire Eurozone in meeting these rules by 2027. It is not Greece or Italy, but Portugal, which Montenegro presents to Europe as an example of rigour. This is where Montenegro's narrative falls apart. The 'balance' he boasts about does not come from the State spending with restraint, but from the Portuguese paying more taxes. The tax burden in 2025 stood at 35.4% of GDP, compared to 35.3% in 2023, before he arrived at São Bento. Despite five IRS updates announced in press conferences, the bill the Portuguese pay to the State has risen, not fallen. The issue is not the government providing fuel subsidies, which only buys time with the taxpayer's own money. The issue is the State continuing to grow without limits and using that uncontrolled spending as an excuse to deny the Portuguese serious tax cuts. The government has had an entire ministry dedicated to State reform since 2025, yet that ministry increased its own budget by 71% in 2026. Montenegro may continue to claim he will not be the father of austerity, but austerity is already here, hidden in a tax burden that does not decrease to pay for a State that no one in this government has had the courage to slim down.

ANAREC: 'Government collected millions' during the crisis

ANAREC claims that the announcements of ISP reductions have not resulted in a decrease in the tax burden for the Portuguese people. João Durão further accuses the Ministry of Energy of profiting from taxes on gas.

ANAREC accuses the Government of lying and calls for oversight

The president of ANAREC calls for a reduction in the tax burden on fuels due to an excessive loss of competitiveness compared to Spain. Price differences can range between 30 and 40 cents.

Fuel retailers accuse Government of “lying” to the Portuguese and demand more oversight

The president of ANAREC, João Durão, accused the Government of “making money from fuel and lying to the Portuguese” and demanded “more oversight” to stop the daily “smuggling” between Spain and Portugal. The head of the National Association of Energy, Fuel and Service Station Retailers, who was speaking to journalists at a fuel station, ...

Moderate tax burden, but high fiscal effort

Portugal does not stand out in the European Union (EU) for having a particularly high tax and contribution burden as a percentage of GDP. The problem arises when this burden is compared with the taxpayers' ability to pay, measured by the relative standard of living. In 2025, Portugal had only the 20th highest tax and contribution burden in the EU.

Shearing sheep

When collecting taxes or shearing sheep, it is always good to stop when you reach the skin.

Each taxpayer pays 3,063 euros more in taxes than 10 years ago

PRESS REVIEW | The evolution is justified mainly by the IRS

Tax burden exceeding 42% crushes wages

Tax Freedom Day, when one stops paying taxes and contributions, was on 3 June

From 80% of days in non-compliance to full non-compliance?

There is no way around it. If we do nothing, the non-compliance with European rules will be paid for in 2028, amounting to 12 billion. Is it understood now? Or are we prepared for a new record high in the tax burden? Opinion by Mário Centeno

Public Finance Council warns about primary current expenditure

The increase compromises the reduction of the tax burden.

CFP warns that increased spending compromises tax burden reductions

The Public Finance Council (CFP) warned of the increase in primary current expenditure, which “compromises significant reductions in the tax and contribution burden,” in a report on budgetary developments in 2025, released today.

Public Finance Council warns that increased spending compromises tax burden reductions

Portugal closed last year with a budget surplus of 0.7% of GDP and public debt below 90% for the first time since 2009, but for the Public Finance Council (CFP), not everything is 'rosy' in the public accounts. The State's structural expenditure continues to grow and is becoming more rigid, compromising...

OECD recommends Portugal reduce tax burden

Portugal should reduce taxes on lower-wage workers, the OECD report says. The national economic performance remains “below that of the most advanced economies,” they highlight.

OECD recommends Portugal reduce tax burden on lower wages

The OECD recommends that Portugal reduce taxes on lower-wage workers, while increasing the tax burden on property and eliminating ineffective tax exemptions, and advises improvements in employment for young people, women, and senior workers.

Luís Montenegro has increased the tax burden

The government led by Luís Montenegro claims not to raise taxes, yet celebrates a 0.7% GDP surplus. This analysis argues that the surplus stems from higher tax collection and failure to execute planned spending, rather than structural reform or productivity. With the tax burden rising to 35.4% of GDP, the state continues to collect more while failing to deliver essential services like healthcare, education, and justice. The author contends that current growth is fragile and driven by temporary factors, warning that without significant state reform and tax reduction, Portugal faces continued economic decline.

Tax burden rises to 35.4% of GDP and helps support surplus

The tax burden rose slightly to 35.4% of GDP, up 0.2 percentage points from 2024. This is the second consecutive increase. The improvement in public accounts was supported primarily by the growth in tax revenue, which increased by 6.7% to reach 108.7 billion euros. This performance reflected the expansion of economic activity and...

Tax burden increases to 35.4% in 2025

This indicator corresponds to the ratio between tax revenues and GDP.

Iniciativa Liberal calls for urgent debate on fuel tax burden this Thursday

The Iniciativa Liberal party has called for an urgent parliamentary debate this Thursday to discuss and approve measures to mitigate the impact of the war in Iran on fuel prices in Portugal. Parliamentary leader Mário Amorim Lopes argues that the state has not lost any revenue despite minor tax reductions, and calls for legislative changes to lower the tax burden on citizens. Party leader Mariana Leitão advocates for a permanent reduction or elimination of the ISP tax rather than the temporary discounts currently implemented by the Luís Montenegro government.

AEMinho pede alívio efetivo da carga fiscal sobre o trabalho – Cidade Hoje

The Associação Empresarial do Minho (AEMinho) calls for effective relief from high taxes on work in Portugal for 2023, criticizing the current tax burden as socially unjust and a barrier to competitiveness and employment. The association highlights economic challenges such as high inflation, resource scarcity, and energy costs, which negatively impact businesses and citizens. AEMinho emphasizes the need for better resource management, de-bureaucratization, and a more efficient public sector. It also advocates for the creation of a Sectoral Energy Cluster and increased knowledge transfer to enhance competitiveness. Despite economic difficulties, AEMinho reports growth in its membership and activities, aiming to foster economic diversification and innovation in the region.

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Could there be a disruption at fuel stations?

Mafalda Trigo from ANAREC criticises the 60% tax burden and calls for greater discounts following the government's record revenue. She warns of disruptions at fuel stations due to a lack of transport, with normalisation expected on Monday.