Portuguese government approves 800 million euro support package

On September 18, 2026, the Portuguese government announced an 800 million euro relief package aimed at mitigating the impact of the rising cost of living. The measures include a one-time bonus for pensioners and retroactive income tax reductions.

The centerpiece of the plan is a 400 million euro disbursement scheduled for December, targeting over two million pensioners who receive a gross monthly pension of up to 1,600 euros. The bonus will range from 200 euros for lower pension brackets to 100 euros for higher ones. Additionally, the government will implement retroactive income tax cuts effective from January for individuals earning up to 43,000 euros in annual taxable income.

Prime Minister Luís Montenegro, who announced the measures in a televised address, defended the package as a balance between social sensitivity and fiscal responsibility. He explicitly rejected opposition proposals, such as eliminating the value-added tax (VAT) on essential food items, arguing that such actions would jeopardize public finances. No further major interventions are expected in the near term as the government prioritizes current fiscal stability.