As expected since the last change to the IRS table decided by parliament in July, the rates for the 6th, 7th and 8th and 9th brackets will remain the same, at 34.9%, 43.1%, 44.6%, 48%.
Although there is no reduction in rates at the last levels, taxpayers in these income bands also benefit from the reduction, because the IRS is calculated progressively, that is, a taxpayer’s income is divided according to the tax brackets and the respective rate applies to each one. As a result, the relief at lower levels also has an impact on the taxed income of these taxpayers, reducing the IRS payable.
In addition to the reduction in rates, the new table now approved in the specialty brings an update to the values that define each of the IRS brackets at 3.51%.
Another rule was also approved that updates the value of the minimum wage, the tax rule that guarantees that those with lower incomes, up to the value of the minimum wage, are completely exempt from tax.
With approval, it is guaranteed that annual income up to 12,880 euros will not be paid IRS or, in the higher case, up to the amount resulting from the update of the Social Support Index (IAS), corresponding to 1.5 times the IAS over 14 months.