The Portuguese Tax Authority has issued Circular Letter No. 20273/2025 on 22 January 2025, outlining the municipal surcharge rates for corporate tax in fiscal year 2024.
The circular introduces several key provisions, including:
- Lower reduced rates for smaller companies: Some municipalities have further decreased their reduced tax rates.
- Conditional application of reduced rates: Smaller companies must now meet additional conditions, such as local job creation, to qualify for reduced rates.
- Expanded exemptions: Certain municipalities have introduced additional exemptions based on companies’ turnover in the previous tax year and/or their local job creation efforts.
A municipal surcharge refers to an additional charge imposed by the municipality beyond the standard tariff for municipal services provided.