Portugal tax inequality concerns over non-habitual resident regime

The non-habitual resident tax regime in Portugal has created significant fiscal inequality, with estimated tax expenditures reaching 1,741 million euros in 2024. While the regime was designed to attract investment and talent, it has resulted in individuals with similar incomes paying vastly different tax amounts based on their residency status.

Critics argue that this fiscal exception has contributed to pressure on housing prices in major urban centers. Although the regime has been revoked, successor benefits continue to exist. There are calls to review these benefits to ensure fiscal competitiveness does not come at the expense of tax justice for permanent residents who support the national social security, health, and education systems.