State Budget 2025: what changes for Portuguese SMEs?

The presentation of the State Budget Proposal always generates great anticipation among entrepreneurs, who are attentive to the tax policies that the government will implement and which directly affect their companies, employees and partners. As for the 2025 State Budget Proposal, although it doesn't bring significant changes in terms of tax incentives, capitalization and investment support, there are some positive changes that are worth highlighting.

Here are the main measures that could affect SMEs:

• Lower corporate income tax for SMEs: Reduction in 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 tax base limit from 25,000 to 50,000 euros;
• Incentive to increase salaries: Salary increases are increased by 200% in IRC, with a limit of 4,350 euros;
• Increased expenditure on health insurance: Expenditure on health insurance for employees and their families increased by 20% for IRC purposes;
• IRS exemption for the “15th month”: IRS exemption for productivity bonuses and others, up to 6% of the employee's annual basic salary, if salaries have increased by at least 4.7%;
• Reduction in 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 for company capitalization: Companies that choose to strengthen their equity may deduct from their taxable profit an amount corresponding to the 12-month Euribor rate plus 2 points;
• National minimum wage to rise again: It was proposed and approved in social consultation that the national minimum wage should rise to €870 in 2025, with the aim of reaching the target of €1020 in 2028. This represents an increase of 6.10% on the current value (above inflation).

The Portuguese economy is expected to accelerate next year. If the forecasts are confirmed, Portugal will grow by 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 any significant measures for SMEs, the economic outlook for next year is optimistic. Stability in inflation and the unemployment rate and the forecast of a budget surplus contribute to a scenario of continuity, minimizing risks that could negatively impact business activity. Companies will therefore be able to operate in a relatively secure environment, even in the absence of initiatives specifically aimed at their challenges.