Estimates surpass a total of 27,000 foreign taxpayers in Portugal currently enrolled in the NHR programme. The latest developments come from Sweden, looking to broach negotiations of its tax treaty with Portugal. This initiative follows on the heels of Finland’s threat to tear up its tax accord with Portugal if the Portuguese legislature fails to ratify a newly negotiated settlement by the end of November. With changes validated, new rules could apply to Finnish residents in Portugal as of 2022.
The Finnish Government proposes that the bilateral tax treaty with Portugal, dating from 1970, should be terminated by the end of the year, waiting for a new agreement in 2019. At issue is the dissatisfaction with Portuguese Non-Habitual Residency regime which has led many Finnish pensioners to “flee” to Portugal seeking exemption from taxation. Finnish Finance Minister Petteri Orpo stated that “the tax treaty is not fair”. In 2016, Portugal and Finland agreed to update the treaty but, 18 months later, no changes have occurred.