The Portuguese socialist government distances itself from the Spanish: it agrees to deduct inflation from personal income tax and achieves an income pact

The Portuguese socialist government once again distances itself from the Spanish government and agrees to promote a relief in Income Tax to close the Income Agreement.

According to the official agreement presented on Sunday by Prime Minister

, the agreement, valid for four years, includes

, which is the official inflation expected by the Portuguese Executive of so that the salary increases achieved by the Portuguese workers are net and the State does not keep part of them.

This is the so-called deflation requested by the Popular Party in Spain, consisting of preventing a salary increase from causing a jump in the IRPF section that makes the worker's tax bill more expensive.

The 12-page document includes the "updating, in 2023, of the sections of the Personal Income Tax (IRS) with the criterion of nominal appreciation of the remuneration per worker (5.1%), and

".

It is about avoiding, says the agreement of the Government with the social agents, "an aggravation of taxes due to salary increases".

As a complement, the counterpart of

in Portugal, the Minister of Finance,

, undertakes "to bring closer and, whenever possible, eliminate" the difference between the withholdings in the payroll for the tax and what is actually ends up paying.

In exchange for this fiscal gesture, the Government is trying to promote a 5.1% salary increase in 2023, the first year of the new income agreement, which employers and unions are also committed to trying to agree on.

The objective is to ensure that Portuguese employees earn an average of 20% more in 2026 than in 2022.

The agreement includes energy aid measures valued at 3,000 million and

to 17% -well below the Spanish rate- for small and medium-sized companies that raise wages or invest in research and development.

An increase in the minimum interprofessional salary is also expected, which is currently 705 euros, one of the lowest in the EU.

in 2023

with the aim of reaching

, at the end of the socialist legislature.

In Spain it is currently one thousand euros.

"This agreement is an act of trust that gives the Portuguese and economic agents certainty in the goals we have;

to achieve those goals and gives stability on the path to achieving those goals. "

goals," Costa said in the deal announcement.

This Monday he presents the Budget project for 2023, collecting the committed personal income tax update.

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