With the approval of the State Budget for 2026, the Portuguese will experience changes in several areas that directly impact their pockets, from taxes to transport and the minimum wage. Among fiscal, social and mobility measures, there are changes that bring immediate benefits and others whose effects will be felt more throughout the year.
According to Notícias ao Minuto, one of the most notable changes is the 0.3% drop in IRS rates applicable from the second to the fifth bracket. This reduction follows the automatic annual update of the tiers by 3.51% and will have an estimated cost of 110 million euros. According to the same source, this measure aims to alleviate the tax burden on average incomes.
Minimum wage, benefits and IRS Jovem
The national minimum wage will rise to 920 euros from January 2026, 50 euros above the current value. The Government also foresees a gradual increase until 2029, when it should reach 1100 euros. This increase follows the growth of social benefits, although the exact value depends on the publication of the social support index, which serves as a reference for pensions, parental and unemployment benefits, family benefits and subsidies for informal caregivers, among others.
The IRS Jovem will continue in 2026, offering total or partial exemption on income from work for young people up to the age of 35 in the first ten years of their career, although it is not yet defined whether this benefit will be cumulative with the salary premium for recent graduates.
The solidarity supplement for the elderly will increase by 40 euros, from the current 630.67 euros to 670.67 euros per month. This support is aimed at people aged 66 years and seven months or older who have annual income of up to 7,568 euros, and should reach 870 euros by 2029.
Housing, education and culture
In housing, the maximum ceiling for income tax deductions will rise to 900 euros in 2026 and to 1000 euros in 2027, above the previously predicted values. The exemption on IMT, stamp duty and fees for the purchase of their first home by young people up to the age of 35 will also increase, now covering properties up to 330,539 euros.
Another new feature is the possibility of deducting VAT from shows, museums and books in IRS, up to a limit of 250 euros per household, applicable only to the IRS declaration to be submitted in 2027. In higher education, the freeze on tuition fees remains in place, with no increase for the 2026/2027 academic year.
Mobility and tolls
Among the changes that most affect daily life is the exemption from tolls for residents and companies on some sections of the A2 and A6 motorways in Alentejo. This measure will be implemented by the end of the first quarter of 2026 through an electronic device associated with the vehicle’s registration plate.
In A6, residents and companies in NUTS III of Alto Alentejo and Alentejo Central are covered, and in A2 those in the Baixo Alentejo and Alentejo Litoral region. The elimination of charging on the few sections of the A25 that still maintained tolls was also approved. According to , this measure aims to facilitate mobility and reduce costs for those who travel daily on these roads.
These changes reflect a set of adjustments planned for next year, which affect both disposable income and the cost of living and mobility of Portuguese people, anticipating direct and indirect impacts on the wallets of millions of citizens.
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