EUROCOSTSCOUNTRY COMPARISON · UPDATED 2026-07-15
Italy vs Portugal: taxes, salary and cost of living
A move between Italy and Portugal is not simply a choice between a cheap and an expensive country; income, rent and taxation pull the result in different directions.
Italy vs Portugal at a glance
| Indicator | Italy | Portugal |
|---|---|---|
| Standard VAT | 22% | 23% |
| Income tax | 23-43% | 12.5-48% |
| Social contributions | ~42% | 34.75% |
| Tax burden | 47.1% | 41.8% |
| Average monthly salary | €3,312 | €1,877 |
| Studio rent | €726 | €900 |
| Monthly food estimate | €320 | €300 |
| Gasoline | 1.74 €/L | 1.73 €/L |
| Electricity | 0.3 €/kWh | 0.24 €/kWh |
Income comparison in context
Italy records the higher listed monthly salary. The gap is €1,435, approximately 76.5% relative to the lower figure. Within the numeric EuroCosts sample, Italy ranks 12 of 27 for salary and Portugal ranks 18 of 27. The nominal advantage should be tested against local housing before it is treated as additional purchasing power.
Rent, food and the monthly budget
Italy has the lower listed studio rent by €174, a 19.3% difference relative to the higher rent. Italy sits 19 of 37 and Portugal 26 of 37 in the available low-to-high rent ranking. Portugal also has the lower food estimate, so the housing result is partly offset by groceries.
After subtracting only the listed rent and food estimates, the simplified remainder is €2,266 in Italy and €677 in Portugal. This leaves €1,589 more in Italy, before utilities, transport, healthcare, childcare or personal taxes not already reflected in salary.
Headline taxation: what differs
Portugal has the lower listed tax burden by 5.3 percentage points. Standard VAT is 22% in Italy versus 23% in Portugal. Effective taxation depends on income level and household circumstances.
A practical transport check
Portugal has the lower listed gasoline price by €0.01 per litre. For a driver buying 50 litres a month, that headline difference is about €0.5 monthly, before insurance, parking and road charges.
Who may prefer each country?
For a remote worker paid from abroad, housing and daily costs may matter more than the local salary ranking; on that narrow view, Italy deserves closer attention. A locally employed professional should instead begin with salary and payroll definitions.
The most useful conclusion
Italy produces the stronger simplified monthly remainder in this dataset, while Italy leads on listed rent. The trade-off is more informative than a blanket cheapest-country label.
Sources and data references
- PwC standard VAT rates
- PwC personal income tax rates
- PwC corporate income tax rates
- EuroCosts data scope and generation process
Explore Italy comparisons · Explore Portugal comparisons