According to the budget execution summary, Municipal Property Transfer Tax (IMT) collections reached €1.43 billion from January to August.
Accumulated revenue grew 28.8% compared to the same period last year (compared to €1.11 billion), and this movement explains part of the increase in revenue in the first eight months of the year.
In summary, the EO (the new name for the General Budget Directorate) details that “the increase in tax revenue (9.1%) was essentially due to the execution of the IRS (16.6%) and VAT (9%) and, to a lesser extent, the IMT (28.8%) and ISP (13.4%), mitigated by the decrease in the IRC (-8%).”
The improvement in IMT revenue, according to this service of the Ministry of Finance, is a “reflection of the dynamics in the national real estate market, which saw an increase in real estate transactions and their value.”
From July to August, the increase in revenue exceeded €200 million (€200.77 million), marking the second month in 2025 that the monthly increase reached this magnitude (from May to June, the growth was €231 million).
Contradiction
The trend recorded through August of this year contradicts the cumulative tax collections observed in the last two years.
In 2024, revenue fell 2.9% from January to August, and in 2023, it fell 1.3%. However, in 2022, the cumulative value for the first eight months of the year was positive, with revenue growing 38.3%. This trend has now been repeated, but at a slower pace, of 28.8%.
Detran (Department of Motor Vehicles) accounted for more than half of municipal tax revenues through August. In total, the local government received €2,723.6 million from the share of tax collections that, under the law, constitute its revenue (such as the IMT (Important Property Transfer Tax), the IMI (Important Vehicle Transfer Tax), the Single Circulation Tax, and the municipal corporate income tax). With the growth in ITBI revenues, this tax now represents 52.5% of total revenue collected through August.
At last week’s Council of Ministers meeting, which approved a package of housing measures, one of the measures the executive branch intends to propose to parliament involves increasing the IMT (Property Transfer Tax) on home purchases by “citizens not resident in Portugal, excluding emigrants,” according to the September 25th statement.
Detran’s revenue belongs to the municipalities where the properties are located. As a rule, the tax is levied on the sales price stated in the contract or, if the amount is higher, on the property’s market value.
For properties intended exclusively for permanent residence, IMT rates are progressive, varying according to the purchase value (up to 7.5% for the highest values, above €1,128.28).
For “other urban buildings,” the IMT Code provides for a flat rate of 6.5%, and for rural buildings, a rate of 5%.
