This new tax residency type was created in order to attract to Portugal high-skilled professionals and pensioners obtaining foreign income.
[4] A person, regardless of their nationality, may apply for registration as a non-habitual resident if the following conditions are fulfilled:[3][4][5] Under Ministerial Order issued by the Ministry of Finance, the follow jobs are subject to flat personal income tax of 20%:[5][8][9] The corporate tax rate applicable to companies in Portugal may vary, depending on which part of the Portuguese territory said companies are incorporated and domiciled.
[10] Companies incorporated and headquartered in Madeira can apply for an International Business Centre (MIBC) license and, granted that they comply with substance requirements, benefit from a corporate tax rate of 5% on the taxable profit derived from economic activities engaged with non-resident entities or entities duly licensed within the MIBC.
This is followed by a further reduced rate of 6% on cereals, meat, shellfish, fruit, vegetables, and other essential foods, books, newspapers, medicines, passenger transport and hotel accommodation.
The goal is to bring into the formal economy the many unregistered and untaxed purchases.