Tenants consider the measure of the Socialist Party (PS) to increase the deduction limit for the collection of income tax costs to 600 euros “insufficient” and argue that the ceiling for next year should rise to the value of the National Minimum Wage already approved for 2024. António Machado, general secretary of the Lisbon Tenants’ Association, advocates that the deduction increase from the current 502 euros to 820 euros. As part of the proposed changes to the State Budget (OE), the PS proposed an increase to 600 euros, 50 euros higher than what the government has already conceded. OE 2024 will be voted on on November 29.
“It is a small progress, but it is not enough,” says António Machado. According to the leader, “the right public accounts have the capacity to” absorb this increase, which “would offset income increases for everyone.” Remember that rents will rise by 6.94% next year and only some tenants will have access to support. In fact, this is one of the arguments of the PS to continue with this measure that they want to include in OE2024.
“Unlike the option taken for 2023, there will be no brake on rent increases for the year 2024, meaning that taxpayers who see their income rising and are not beneficiaries of extraordinary income support will have to make a greater effort to support their families.” to manage. budget,” reads the amendment proposal. The ruling party is also advancing an increase from 800 to 900 euros in the deduction of rental costs for tenants with an income equal to or lower than the first income tax bracket.
António Machado also claims that the deduction rate should increase from 15% to 20% of the rental price, up to the maximum ceiling which, if the PS proposal is approved, will then rise to 600 euros. The measures proposed by the Lisbon Tenants Association are based on the belief that “in the vast majority of rental contracts, the tenants’ effort is 40%”. The PS states that its proposal will allow holders of a lease for permanent housing to receive an additional discount of about 100 euros from the IRS.
As far as tenants are concerned, the PS is also coming up with a proposal to reduce the withholding tax by 40 euros. The measure targets taxpayers with a monthly income of up to 2,700 euros, and its implementation is dependent on a declaration of intent from employers. The aim of this measure is to “guarantee greater monthly liquidity for families to pay their rent”, who have faced the escalation of inflation and the increase in the price of access to housing over the past two years.
To overcome the current problem of the lack of houses in the country, the PS defends the exemption from IRS and IRC on the sale of land for public construction, in an effort to expand the tax measure already approved by Parliament and which is aimed at the sale of properties.
In another sense, the PS has submitted a proposal to change the regime for non-habitual residents (RNH), defending the maintenance of benefits until the end of 2024 for citizens who can prove that they already planned to go to Portugal this year to move house. The OE proposal presented by the cabinet contained a transitional regime, but limited access to the RNH to those who were registered with the Tax Authorities on December 31 of this year, or met the conditions for registration on that date.
Other PS proposals
PPR rescue
Maintain the option of penalty-free repayments from pension savings plans (PPR) to cover the costs of home loans. The PS proposes that families will be able to repay savings plans (pension and/or education) by the end of 2024 without a penalty or limitation on the amount for paying credit terms or deliveries to housing cooperatives. For the early repayment of debts for the purchase of a house, an annual limit of 24 IAS – Social Support Index is advocated, i.e. around 12,400 euros (this year the limit was 12). It is also possible to withdraw PPR for any purpose, but with a monthly limit of one IAS.
Homework
To encourage domestic service reporting, a deduction of 200 euros was proposed to the IRS for expenses incurred by these employees. The measure also aims to combat the informal economy and tax evasion.
Pass support
Increase resources by EUR 50 million to ensure the maintenance of public transport pass prices, as set out in the Incentive +TP programme.
Green vouchers
Implement IT changes to apply progressive withholding tax rates to self-employment next year. The aim is to replace the 25% flat rate model, so that the withholding tax is adjusted to the actual income that these employees have.
Startups with access to RNH
Expand access to the non-habitual resident (RNH) tax regime to employees of companies certified as startups. These employees can benefit from a 20% IRS rate for 10 years.
Most expensive cigarillos
Gradually increase the tax on cigarillos over the next three years, as provided for in the 2024 state budget proposal. The measure aims to penalize cigarillos that have entered the market at much lower prices than usual for this type of product.
Sónia Santos Pereira is a journalist for Dinheiro Vivo
Source: DN
