Tax Rate Comparison · 2026

Portugal vs Italy: Tax Rates Compared

Compare Portugal and Italy on income tax, corporate tax, VAT, capital gains, and social security. Top income tax: 48% (Portugal) vs 43% (Italy). Includes take-home pay estimates, special regimes, and expat guidance for 2026.

Country A
Portugal
Top income tax: 48%
Corporate: 21%
VAT: 23% · CGT: 28%
VS
Country B
Italy
Top income tax: 43%
Corporate: 24%
VAT: 22% · CGT: 26%

Full Tax Rate Comparison

Tax TypePortugalItalyLower Rate
Top Income Tax48%43%Italy
Bottom Income Tax13%23%Portugal
Corporate Tax21%24%Portugal
VAT / GST23%22%Italy
Capital Gains Tax28%26%Italy
Social Security (Emp)11%9.5%Italy
Dividend Tax28%26%Italy
Tax Treaties7996Italy

Take-Home Pay Estimate

Illustration — €100,000 gross annual income
Portugal Take-Home
€57,800
Italy Take-Home
€62,560
Annual Difference
+€4,760

Verdict

Overall Tax Burden
Near-identical overall tax burden
Both Portugal and Italy have comparable overall tax burdens. Top income tax: 48% (Portugal) vs 43% (Italy). Corporate: 21% vs 24%. The choice should be driven by residency conditions, treaty access, and lifestyle.

Tax System: Territorial vs Worldwide

FactorPortugalItaly
Territorial TaxationNoNo
Digital Nomad VisaYesYes
Wealth TaxNoNo
CFC RulesYesYes

Special Regimes Available

CountryRegimeRate / BenefitDuration
PortugalIFICI (ex-NHR)10% flat rate10 years

Frequently Asked Questions

Which country has lower taxes: Portugal or Italy?
Portugal has a top income tax rate of 48% and corporate tax of 21%. Italy has 43% and 24% respectively. On €100k gross, estimated take-home is €57,800 in Portugal vs €62,560 in Italy. Actual liability varies with deductions, residency rules, and individual circumstances.
Is Portugal or Italy better for expats and digital nomads?
Portugal uses a worldwide tax system and offers the IFICI (ex-NHR) (10% flat rate, 10 years). Italy uses a worldwide tax system. The best choice depends on income type, desired residency duration, and lifestyle preferences.
What is the corporate tax difference between Portugal and Italy?
The statutory corporate tax rate is 21% in Portugal and 24% in Italy. Effective rates can differ significantly due to deductions, loss carry-forwards, and R&D credits. Both countries may offer reduced rates or special regimes for SMEs or qualifying businesses.
Portugal Full Tax Guide Italy Full Tax Guide More Tax Comparisons Special Tax Regimes
Disclaimer: Rates shown are statutory rates for 2026. Effective rates vary with deductions and individual circumstances. Not tax advice.