&NewLine;<p>The state budget for 2021 &lpar;<a href="https://vivreauportugalconsulting.com/budget-2021-au-portugal/" class="rank-math-link">OE2021</a>From January 1, 2021, the new government will introduce 18 changes, ranging from increases in the minimum wage and cuts in pensions to the creation of new social assistance schemes and a reduction in VAT on electricity. Let's take a look at what's changing in Portugal in 2021; </p>&NewLine;&NewLine;&NewLine;&NewLine;<h2 class="wp-block-heading">What changes in Portugal in 2021</h2>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">1&period; Minimum wage increase </h3>&NewLine;&NewLine;&NewLine;&NewLine;<p>The national minimum wage &lpar;SMN&rpar; for the&rsquo&semi;year 2021 is set at 665 euros&period; This&rsquo&semi;is an increase of 30 euros compared with 2020 &lpar;&plus; 4&comma;7 &percnt;&rpar; and d&rsquo&semi;an increase of 160 euros &lpar;&plus; 32 &percnt;&rpar; compared with 2015&period; This increase will also have an impact on the salaries of &rsquo&semi;public administration workers &lpar;AP&rpar; in 2021&period;</p>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">2&period;Pension increases</h3>&NewLine;&NewLine;&NewLine;&NewLine;<p>Pensioners with pensions of up to €658&comma;2 will benefit from an extraordinary increase of €10&period; The Ministry of Finance guarantees that this increase "will guarantee real gains in purchasing power for around 1&comma;9 million pensioners"&period; The increase for January will be paid in conjunction with February&period;</p>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">3&period; New social support for unprotected workers</h3>&NewLine;&NewLine;&NewLine;&NewLine;<p>Workers who have suffered income cuts as a result of the pandemic crisis&period; They will receive extraordinary new social support&comma; which will be based on the value of the poverty line &lpar;501&comma;16 €&rpar;&period; It is estimated that the new social benefit could reach 258,000 people&period; The&rsquo&semi;aid will cover employees who lose access to unemployment benefit in 2021 &semi; economically dependent self-employed workers &semi; self-employed workers with at least three months of contributions in the 12 months preceding the application and whose invoicing is less than 40 &percnt;&period;</p>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">4&period; Minimum unemployment benefits increased and benefits extended by six months</h3>&NewLine;&NewLine;&NewLine;&NewLine;<p>In 2021&comma; the minimum threshold of&rsquo&semi;unemployment benefit will rise from €438&comma;81 to €504&comma;6 for full-time workers&comma; covering around 130,000 people&period; At the same time&comma; workers whose&rsquo&semi;unemployment benefit expires in 2021 will be entitled to an extension of this assistance for a further six months&period;</p>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">5&period; Free childcare for over 60,000 children</h3>&NewLine;&NewLine;&NewLine;&NewLine;<p> In 2021&comma; free crèches will cover all children attending a public day-care center or cooperative system&period; The measure is aimed at households in the 1st and 2nd income brackets and could benefit 60,000 children&period;</p>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">6&period; Extraordinary support for gradual recovery </h3>&NewLine;&NewLine;&NewLine;&NewLine;<p>The Aide Extraordinaire à la Reprise Progressive is extended until June 30, 2021, and provides for the payment of 100&percnt; of remuneration within the limit of three minimum &lpar;1,995 euros&rpar;&period; The full salary also covers workers who are laid off&period;</p>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">7&period; More doctors&comma; more beds and more equipment for the SNS</h3>&NewLine;&NewLine;&NewLine;&NewLine;<p>OE2021 includes the hiring of 4,200 employees for the National Health Service and 261 additional workers for INEM &semi; the reinforcement of Continuing Care Units&comma; with 400 new beds for the general network&comma; ten Day Units and Autonomy Promotion &lpar;200 new places in the Mental Health CCIs&semi; in addition to a 150 million euro reinforcement in primary healthcare for equipment and facilities and 50&comma;5 million euros for the replacement and purchase of heavy hospital supplies&period;</p>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">8&period; Autonomies and modernizing public schools</h3>&NewLine;&NewLine;&NewLine;&NewLine;<p>Over the course of 2021&comma; a further five thousand operational assistants will be hired for state schools, and a 400 million&semi;euro reserve is set aside for a school digitization program&period;</p>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">9&period; Adjustment of IRS withholding tax tables</h3>&NewLine;&NewLine;&NewLine;&NewLine;<p>In 2021&comma; the Government promises to continue the gradual and progressive path to blurring the gap between the deductions at source made by dependent workers and the final amount of tax payable&period; This adjustment will make around 200 million&rsquo&semi;euros available to households next year&comma; estimates the Ministry of Finance&period;</p>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">10&period; IRS exemption limit increased by €100</h3>&NewLine;&NewLine;&NewLine;&NewLine;<p>The IRS exemption ceiling increases by €100&period; the minimum amount up to which taxpayers are exempt from paying IRS&comma; will be increased by €100 to €9,215&period; There are around 30,000 new aggregates that will therefore also be exempt from this tax&comma; reveals the Ministry of Finance&period;</p>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">11&period; Reduction in VAT on electricity</h3>&NewLine;&NewLine;&NewLine;&NewLine;<p>The reduction in VAT on electricity &&num;8211&semi; to an intermediate rate of 13 &percnt; for consumption of up to 100 kilowatt-hours &lpar;kWh&rpar; of monthly consumption &&num;8211&semi; came into force on December 1&comma; meaning that January's bill can already reflect savings&period; From March 2021&comma; large families &lpar;aggregates with five or more elements&rpar; will benefit from a 50 &percnt; increase, and the 13 &percnt; VAT rate applies to consumption up to&rsquo&semi;150 kWh per month&period;</p>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">12&period; Ban on cutting off water, electricity, gas and communications in the first half of the year</h3>&NewLine;&NewLine;&NewLine;&NewLine;<p>There is a rule in OE2021 that prohibits the cutting off of essential services such as water supply&comma; electricity&comma; natural gas or communications &lpar;in the latter case&comma; if the consumer is unemployed&comma; has a drop in income greater than 20&percnt; or is infected with COVID19&rpar; during the first half of 2021&period;</p>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">13&period; Extraordinary investment tax credit</h3>&NewLine;&NewLine;&NewLine;&NewLine;<p>The Extraordinary Investment Tax Credit (Crédit d'Impôt Extraordinaire à l'Investissement) is a deduction from IRCs corresponding to 20&percnt; of investment costs incurred up to the end of the first half of 2021&comma; up to a limit of 5 million euros&comma; to be used for a maximum of five years&period; It requires jobs to be maintained during the period the tax credit is used&comma; with a minimum of three years&period;</p>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">14&period; VAT and IRC can be paid in instalments.</h3>&NewLine;&NewLine;&NewLine;&NewLine;<p>During the first half of 2021&comma; companies and the self-employed can benefit from&rsquo&semi;a special, transitional phase of VAT supplies&period; Compliance with benefit schemes is with the&rsquo&semi;tax authorities&period;</p>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">15&period; IVAucher encourages consumption in sectors hardest hit by the pandemic</h3>&NewLine;&NewLine;&NewLine;&NewLine;<p>The program <a href="https://www.publico.pt/2020/11/12/economia/noticia/ivaucher-so-pandemia-controlada-1939018">IVAucher</a> aims to stimulate consumption in the sectors most affected by the pandemic, while increasing disposable household income by around 200 million euros&period; Consumers will be able to accumulate 100 &percnt; of the VAT incurred in the accommodation&comma; culture and catering sectors over a 12-week period&comma; and this balance will also be available for use in these sectors over a further 12-week period&period; However, the Government has conditioned the entry into force of the measure on the health crisis evolving&period;</p>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">16&period; Enrolment in bank moratoria extended to March</h3>&NewLine;&NewLine;&NewLine;&NewLine;<p>In order to address liquidity and cash flow constraints resulting from the economic impact of the second wave of the pandemic&comma; the government has approved an amendment to the banking moratorium regime&comma; allowing new enrolments up to&rsquo&semi;to March 31 and for a maximum period of nine months from the date of enrolment&period; For example&comma; families and businesses requesting a moratorium at the beginning of January will be able to benefit from it until the end of September&period; If the bank is notified of the application at the end of March&comma; the moratorium will remain in force until the end of the year&period; Companies in the sectors most affected by the pandemic will still benefit from an extension of their credit terms&comma; over a period of 12 months&comma; in addition to the credit deferral period&comma; enabling payments to be made more gradually and in line with the evolution of economic activity&period;</p>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">17&period; Public guarantees for economic support measures</h3>&NewLine;&NewLine;&NewLine;&NewLine;<p>The budget provides for the granting of public guarantees of up to 6 billion euros&comma; enabling the creation of credit lines to support the&rsquo&semi;economy&period; This amount&comma; which&rsquo&semi;is aimed at businesses and households&comma; includes maintaining&&num;8217&semi;employment and supporting the liquidity and cash flow of economic operators&period;</p>&NewLine;&NewLine;&NewLine;&NewLine;<h3 class="wp-block-heading">18&period; Reduction in toll prices on ex-SCUT and inland freeways</h3>&NewLine;&NewLine;&NewLine;&NewLine;<p>From January 11&comma; frequent private users and passenger vehicles will benefit from discounts on tolls on the&rsquo&semi;former SCUT&period; Class 1 and 2 vehicles benefit from&rsquo&semi;a discount of 25 &percnt; from the 8th day of&rsquo&semi;use of&rsquo&semi;a month on the same route&period; The discount applies to certain 10-lane routes or sub-laning &colon; A22 &&num;8211&semi; Algarve &semi; A23 &&num;8211&semi; IP &semi; A23 &&num;8211&semi; Beira Interior &semi; A24 &&num;8211&semi; Interior Norte &semi; A25 &&num;8211&semi; Beiras Litoral e Alta &semi; A28 &&num;8211&semi; Norte Litoral &semi; A4 &&num;8211&semi; AE transmontana sub-concession &semi; A4 &&num;8211&semi; Tunnel de Marão &semi; A13 and A13-1 &&num;8211&semi; Pinhal Interior sub-concession&period; In the case of freight vehicles&comma; the current reduction of 30 &percnt; during the day and 50 &percnt; at night is reduced&comma; to 35 &percnt; and 55 &percnt;&period; The 55 &percnt; reduction also covers weekends and public holidays&period; This reduction scheme is extended to passenger transport on these ten routes&comma; in addition to the Grand Port concession &lpar;A4&comma; A41 and A42&rpar; and the Côte d&rsquo&semi;Argent concessions &lpar;A17&comma; A25 and A29&rpar;&period;</p>&NewLine;
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