Personal Taxes

Costa reveals plans for 2 new earnings tax brackets – EURACTIV.com

The socialist government is working on measures under the draft state budget for 2022 to add additional income tax brackets between 10,000 and 20,000 euros of annual income and between 36,000 and 80,000 euros, said Prime Minister António Costa.

Costa mentioned the plans in an interview on TVI television after responding to criticism of Portugal with a relatively high tax burden.

“We are working very seriously right now to identify in the next state budget for 2022 the possibility of doing what we couldn’t do this year – which is another breakdown of tax brackets,” said Costa, adding that the priority was the introduction of changes in two specific areas: the third and the sixth.

“In the third group, which covers incomes between 10,000 and 20,000 euros, we have a big difference,” said the Prime Minister. “Then there is the sixth range between 36,000 and 80,000 euros where there is a huge difference,” he added.

During the interview, Costa once again rejected the criticism of Portugal’s high tax burden, which it highlights at the EU level. But he did not try to justify the current weight of taxes.

“As you will recall, at the time of the Troika there was a great consolidation of the [IRS] Brackets, ”he recalled, referring to when Portugal implemented the terms of a euro area bailout package following a debt crisis under the supervision of a trio of international institutions.

“We have already made an initial breakdown of the brackets; We had planned a second separation for this year and had to postpone because of the crisis, ”he added. (Pedro Morais Fonseca, Lusa.pt)

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