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Urgent Tax Measures Introduced
Aside from the Budget Bill, which was presented on 15 October 2012, several other urgent tax measures have been introduced into Portuguese legislation. Taxand Portugal takes a look at the top three amendments.
Corporate Income Tax (CIT)
- Increase from 16.5% to 25% of the CIT withholding tax rate due on payments made to resident corporate entities on rental income and royalties.
- Increase from 30% to 35% of the CIT withholding tax rate on investment income made available in bank accounts of 1 or more owners on behalf of non-identified third parties, except if the beneficial owner is identified (in which case the general tax rates become applicable)
- Increase from 30% to 35% of the CIT withholding tax rate due on investment income gained or paid to entities resident in blacklisted jurisdictions.
- Stamp tax is now also due on property and leasehold rights on residential urban immovable property with a tax value of, at least, EUR1.000.000.
Presumed Taxation of Resident Individuals
- The scope for indirect measurement of taxable profit (in the absence of a tax return or certain signs of wealth) has been broadened. This applies if the declared net income is less than 30% of what it would be, if taxed directly.
Multinationals should take note of any changes in tax legislation as it may affect any operations in Portugal. Countries around the world are vying for investment and adapting tax laws is a good way of attracting business.