State Budget 2025

As for the State Budget Proposal for 2025, although it does not bring significant changes in terms of tax incentives, capitalization and investment support, there are some positive changes that deserve to be highlighted.

Here are the main measures that could affect SMEs:

• Reduction of corporate income tax for SMEs: Reduction of the general corporate income tax rate from 21% to 20%. For SMEs and Small Mid Cap, the rate is reduced from 17% to 16%, with an increase in the taxable income limit from 25 thousand to 50 thousand euros;
• Incentive to wage appreciation: Salary increases are increased by 200% in IRC, with a limit of 4,350 euros;
• Increase in health insurance expenses: Health insurance expenses for employees and family members increased by 20% for IRC purposes;
• IRS exemption in the "15th month": IRS exemption for productivity bonuses and others, up to 6% of the employee's annual base salary, if wages have increased by at least 4.7%;
• Reduction of autonomous tax rates: Reduction of 0.5% in autonomous tax rates on vehicles. New limits: 8% for vehicles up to €37,500; 25% between €37,500 and €45,000; 32% for vehicles over €45,000;
• Incentive to the capitalization of companies: Companies that choose to increase their equity may deduct from the taxable profit an amount corresponding to the 12-month Euribor rate plus 2 points;
• National minimum wage increases again: It was proposed and approved in social consultation to increase the national minimum wage to €870 in 2025, with the aim of reaching the target of €1020 in 2028. This represents an increase of 6.10% compared to the current value (above inflation).

The Portuguese economy is expected to accelerate next year. If the forecasts are confirmed, Portugal will grow 2.1% in 2025, 0.8% above the eurozone average, according to the European Central Bank. In addition, inflation is expected to slow to 2.3% and the unemployment rate to remain at 6.5%.

In short, although the State Budget Proposal for 2025 does not introduce significant measures for SMEs, the economic outlook for next year is optimistic. The stability in inflation and the unemployment rate and the forecast of a budget surplus contribute to a scenario of continuity, minimizing risks that may negatively impact business activity. Thus, companies will be able to operate in a relatively safe environment, even in the absence of initiatives specifically aimed at their challenges.