Portugal: Tax measures in draft 2027 state budget law
Draft budget includes changes to individual income tax thresholds and would extend various corporate tax incentives and sectoral levies.
October 27, 2026
The Portuguese government presented the draft state budget law for 2027, which includes proposed changes to existing tax rules affecting individuals and businesses.
Key measures in the proposal would:
- Increase individual income tax bracket thresholds by 3.88%, without changing the general tax rates, and increase the threshold for the 2.5% additional solidarity tax from €80,000 to €89,995
- Maintain an individual income tax exemption, up to 6% of annual base salary, and a social security contribution exemption for certain productivity and performance bonuses, profit-sharing payments, and balance-sheet bonuses paid in 2027, subject to a qualifying salary increase by the employer
- Maintain individual income tax and social security exemptions for certain employer-provided housing, as well as accelerated depreciation for corporate income tax purposes for qualifying employee housing
- Maintain relief from increased autonomous taxation when specified conditions are satisfied
- Reduce from 4.6% to 4.5% the minimum salary-increase thresholds required for the salary-enhancement tax incentive and extend the incentive through December 31, 2027
- Extend the SIFIDE II research and development tax incentive regime to the 2027 tax year under the same terms applicable for 2026
- Maintain for 2027 the existing levies on the banking sector, medical device suppliers to the National Health Service, the pharmaceutical industry, and the energy sector
- Defer application of the accounting SAF-T (PT) filing requirement to periods beginning in 2028, with submissions beginning in 2029, and continue through December 31, 2027, to treat PDF invoices as electronic invoices for tax purposes
Read an October 2026 report (Portuguese) prepared by the KPMG member firm in Portugal