Lisbon, July 8, 2025 (Lusa) - Parliament on Friday approved a reduction in personal income tax that will allow a single worker with no children and a salary of €1,000 to pay €34 less in annual tax than under the current tax scale, according to simulations by PwC.
According to calculations made by the consultancy firm for Lusa, the proposed law, approved in general terms, brings a across-the-board cut in the income tax that taxpayers will pay this year across all income brackets.
The rates fall up to the eighth bracket, and the relief extends to the ninth bracket due to the progressive nature of the tax calculation.
PwC’s simulations demonstrate a reduction in two scenarios: in comparison to the current version of the IRS table and in comparison to the 2024 IRS table.
There is a decrease in IRS at different salary levels, whether in gross salaries of €950, €1,000, €1,100, €1,250, or €1,500, or salaries of €2,000, €3,000, or €4,500, or gross incomes of €6,000 or €7,000 per month.
The calculation for a taxpayer with a salary of €1,000 refers to a single worker in the second income bracket who is not raising any children.
Although the additional gain is €34, the difference compared to last year’s income tax is €264, because the State Budget for 2025 has already provided for adjustments to the brackets and an update of the minimum subsistence rule, which translates into a tax reduction from 2024 to 2025. This new reduction of €34 now adds to the reduction already guaranteed (of €230 per year).
The situation is similar for a couple without children, where each partner earns €1,000 gross per month. The additional reduction in income tax for the couple will be €67 per year. The same applies if we simulate the income tax for two married workers with two children. The overall reduction in tax compared to 2024 is €527 for both couples.
Still in the second income bracket, a simulation for a single taxpayer earning €1,100 gross per month shows that there will be an additional reduction of €55. The final difference compared to last year’s IRS will be €86.
In the third bracket, which includes taxpayers with gross salaries of €1,250 and €1,500, for example, the additional savings will be €65 and €83, respectively. Compared to the 2024 IRS, the difference is €132 and €155, respectively.
In the fourth bracket, a gross salary of €1,850 is subject to an additional reduction of €111, resulting in annual savings of €220 (the previously guaranteed € 109 is combined with this €111 cut).
In the fifth bracket, a salary of €2,000s, also in the case of a single taxpayer without children, will result in an additional reduction in income tax of €124, while the total savings compared to 2024 will increase to €293.
In the sixth bracket, a salary of €3,000 will now pay €207 less than the current IRS table. This brings the annual savings to €385.
In the seventh bracket, a salary of €3,500 will incur an additional reduction of €240, bringing the total reduction to €574 compared to 2024.
For those in the eighth bracket, the last one with a nominal tax cut, the additional savings for those earning €4,500 per month are €290 in annual income tax, resulting in a cumulative difference of €645 compared to 2024.
In the ninth bracket, the last in the table, those earning €7,000 gross per month will see an additional reduction in their IRS of €401, with a tax cut of €866 compared to last year.
These calculations refer to simple standard situations. Specific factors for each taxpayer, starting with the value of tax deductions, influence the actual calculation of the income tax.
PwC assumes that taxpayers have only general and family expenses as deductible expenses.
PCT/ADB // ADB.
Lusa
