DREM releases income statistics for the 2019 period based on the Personal Income Tax (IRS) return

The Regional Directorate of Statistics of Madeira (DREM) proceeds with the dissemination, on an annual basis, of a set of regional information based on anonymised fiscal data from the Portuguese Tax and Customs Authority (AT). This data is related to the settlement note of Personal Income Tax (IRS - Modelo 3), obtained under an agreement between Statistics Portugal (INE) and AT. The information refers to the year 2019 and is broken down by municipality.

In this study, several indicators related to the gross reported income (per se or excluding the tax paid) are released, by tax household or taxable person and also some changes that allow assessing income inequality (S80/S20 ratio and Gini coefficient).

Median value of gross reported income less income tax paid by taxable person in the Region and in the country is similar

In 2019, 116,044 tax households and 160,111 taxable persons were recorded in the Region. Both changes grew by 2.6% and 1.8%, respectively, compared to 2018. In the country, the changes were 2.0% and 1.3%, respectively.

In the same year, the total gross income declared by tax households less income tax paid amounted to 1,878 million euros (+6.7% than in 2018, a higher change than in the country which was 5.0%), which translates into a median value of 11,600 euros (11,934 euros at a national level).

In 2019, the average gross reported income less income tax paid by the taxable person was 11,727 euros (+4.9% than in 2018), while the median was 9,527 euros (+4.7%). At the national level, the average was 11,899 euros (+3.7% compared to the previous year), while the median was 9,539 euros (+4.5%), only 12 euros higher than the regional average.

In the context of the 7 NUTS2 regions, the Autonomous Region of Madeira (ARM) is only behind A.M. Lisboa, the region with the highest median (11,283 euros), which stands significantly above the other regions, while Norte has the lowest median (8,893 euros). The medians of the Autonomous Region of Madeira (2^nd region, with 9,527 euros) and Algarve (6^th region, with 9,168 euros) are relatively close.

Main indicators of income inequality in the Region are slightly higher than in the country

The S80/S20 ratio, which corresponds to the ratio between the total income of the 20% with the highest income and the income earned by the 20% with the lowest income, reached in the Autonomous Region of Madeira, stood at 3.0, in 2019, meaning the income of the richest 20% is 3 times higher than that of the poorest 20%. The national average is 2.8, and by region, A.R. Azores has the highest ratio (3.1), followed by A.M. ​​Lisboa and the Autonomous Region of Madeira (3.0). The region with the lowest inequality according to this indicator is Alentejo (2.6).

The Gini coefficient is also an indicator of inequality in income distribution, which aims to summarize the asymmetry of this distribution in a single value. It assumes values ​​between 0% (when all taxable persons have the same income) and 100% (when all income is concentrated in a single taxable person).

In 2019, the regional Gini coefficient of gross reported income less income tax paid by the taxable person was 36.6%, having decreased by 0.3 percentage points compared to 2018. The value of the Autonomous Region of Madeira is thus very close to the value presented for the total country (36.5%). By region, Alentejo (33.0%) and Centre (34.0%) had the lowest Gini coefficients, while the A.R. Azores (38.1%) and A.M. Lisbon (37.6%) recorded the highest values.

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