There are currently 9 measures in place to respond to the increase in the cost of living: from the reduction of VAT on a set of basic foodstuffs, to support to help pay the rent. Check out what's on offer see if you are eligible.
The general rise in prices that has taken place in recent months has caused a large part of the population to be struggling. To assist, the Government has adopted several measures to try to mitigate the increase in the cost of living felt by the majority of citizens. In total, there are nine support measures in force.
In addition to the list below, there is an interim increase of Portuguese pensions of 3.57%, in force since the beginning of July.
1 – IVA Zero
What is it? A measure that reduces VAT to 0% on 46 essential food items. The objective is to lower and stabilize prices, reducing food charges. In the first month in which VAT Zero was applied, the essential food basket was €10.96 cheaper.
Who is eligible? The entire population.
Until when? IVA Zero started to be applied on April 18th and will be in force until October 31st.
2 – Support for farmers
What is it? A measure that directly supports agricultural producers to face increases in production costs. This reinforcement of 140 million joins the approximately one billion euros of European funds that are available to farmers every year.
Who is eligible? All agricultural producers.
Until when? The support lasts until the end of 2023.
3 – Increase in food subsidy
What is it? The value of the meal subsidy increased from €5.20/day to €6/day. This increase, with retroactive effect to January 2023, is a way to increase the income of Public Administration workers. In the private sector, the IRS exemption is now €6 – or €9.6 when paid by card.
Who is eligible? For all civil servants and private sector employees who benefit from tax exemption.
When did it come into effect? The measure entered into force in April 2023.
4 – Extraordinary salary increase
What is it? A 1% increase backdated to January. This additional 1% is added to the update guaranteed at the beginning of the year, which means that the average increase in the Civil Service is now 4.6%.
Who is eligible? For all civil servants.
When did it come into effect? The measure came into effect in April 2023, retroactive to January.
5 – Support for the most vulnerable families
What is it? Support of €90 per household.
Who is eligible? All beneficiaries of the social electricity tariff and minimum social benefits. In total, more than a million families are helped in this way.
When did it come into effect? The first payment was made on April 20th and is repeated in June, August and November.
6 – Extraordinary support of family allowance
What is it? A support of €15 per month, paid every three months.
Who is eligible? All children and young people benefiting from the Family Allowance (from the 1st to the 4th scale). The amount is paid automatically, by bank transfer.
When did it come into effect? The first payment was made on the 16th of May and is repeated every three months.
7 - Interest subsidy
What is it? A mortgage interest rate reduction for people with an effort rate greater than 35%. It applies to financing of up to 250,000 euros and has a ceiling of 720 euros per year.
Who is eligible? For people up to the 6th income bracket
When did it come into effect? The request for a bonus is possible from May 18th and is valid until December 31st.
8 – Income support
What is it? Monthly support of a maximum value of €200, for a maximum period of five years, for families with a stress rate of more than 35%.
Who is eligible? For people up to the 6th income bracket.
When does it come into effect? Payment of income support begins on May 26, retroactive to January.
9 – Support for fuels
What is it? A way of mitigating fuel prices through a temporary reduction in the oil tax rate.
Who is eligible? The entire population.
When does it come into effect? The measure is evaluated and updated every month and the announcements are made available on the Government Portal.
Measures included in the 2023 State Budget aimed at boosting household income and combating the cost of living:
National minimum wage increase of 7.8%;
Increase of 5.1% in the salaries of civil servants – and the same target for the private sector;
IRS relief measures: reform of the minimum existence, lowering the marginal rate in the 2nd bracket with effect on all other brackets and IRS Jovem;
Increase of 8.4% in the IAS with an impact on social benefits (in addition to pensions);
9.7% increase in family allowance;
Reduction of VAT on electricity;
Pass price freeze;
Limit of 2% on rent increases.
