By Tory Vance
Portugal’s thriving economy, bolstered by the non habitual resident (NHR) tax program, may soon face a severe setback. The current administration’s potential plans to terminate the program by 2024 have raised concerns among experts like Luis Horta e Costa, who fear that the country’s economic progress could be derailed.
Introduced in 2009, the NHR program has driven Portugal’s economic resurgence, offering substantial tax breaks to wealthy foreigners and investors. This initiative has attracted capital and brought innovation and a fresh perspective that has transformed the nation’s economic landscape. Luis Horta e Costa, co-founder of Square View, a Lisbon-based real estate property developer and asset manager, emphasizes the program’s significance: “Foreign investors didn’t just bring capital to Portugal. They brought innovation and a new perspective that transformed our economy. It’s not just about the businesses they established — their investments made Portugal a powerful economic force.”
However, the specter of the NHR program’s termination has raised alarm bells among experts like Luis Horta e Costa, who anticipate a “mass exodus” of foreign investment. Such a departure devastates critical industries, including real estate and tourism. Horta e Costa underscores the program’s impact on Portugal’s real estate market, warning that its termination will bring the sector’s renewed vigor to a screeching halt.
The repercussions of losing the NHR program extend beyond economics, as Lu. Luise Costa argues it has played a pivotal role in shaping Portugal’s image as an open, welcoming, and forward-thinking nation. Without incentives, Portugal risks losing its competitive edge to neighboring countries like Spain, which are implementing similar initiatives to attract foreign capital and talent.
As Portugal stands at a critical juncture, experts like Luis Horta e Costa are urging the government to recognize the NHR program’s immense value and take action to preserve foreign investment. The challenge of replacing the program looms large, and its potential termination could mark a premature end to Portugal’s economic success story.
The NHR program’s fate hangs in the balance, and its termination could have far-reaching implications for Portugal’s economy. Luis Horta e Costa and other experts hope the government will heed their warnings and work to ensure that Portugal remains an attractive destination for foreign investment and talent, safeguarding the country’s hard-won economic gains.
