Taxes in Austria in 2025: Changes you need to know From January 1, 2025, new tax rules came into effect in Austria that are important for all taxpayers. These changes are aimed at improving the financial situation of citizens and include increased income thresholds, which will allow many Austrians to keep more of their money. In this article, we ... Topics: News, Economy.

Taxes in Austria in 2025: Changes you need to know

From January 1, 2025, new tax rules came into effect in Austria that are important for all taxpayers. These changes are aimed at improving the financial situation of citizens and include increased income thresholds, which will allow many Austrians to keep more of their money. In this article, we will take a detailed look at the new tax brackets, changes in deductions, and other important aspects of income tax in Austria in 2025.

What’s new in taxes in 2025?

New income tax table

Under the new rules, the main changes in the 2025 tax table are as follows:

Income (2025)	Income (2024)	Tax rate (2025)	Tax rate (2024)
up to 13,308 euros	up to 12,816 euros	0%	0%
up to 21,617 euros	up to 20,818 euros	20%	20%
up to 35,836 euros	up to 34,513 euros	30%	30%
up to 69,166 euros	up to 66,612 euros	40%	40%
up to 103,072 euros	up to 99,266 euros	48%	48%
up to 1,000,000 euros	up to 1,000,000 euros	50%	50%
over 1,000,000 euros	over 1,000,000 euros	55%	55%

As the table shows, the tax thresholds have been increased by almost 4%, which significantly eases the burden for many citizens. For example, incomes up to 13,308 euros are now completely tax-exempt. This means that lower incomes will be taxed at lower rates or exempt from tax altogether.

Elimination of “cold progression”

One of the key measures is the partial elimination of “cold progression,” achieved by raising the threshold values for tax rates. This measure will prevent a situation where wage growth automatically leads to increased tax liabilities without a real increase in citizens’ purchasing power. According to preliminary estimates, as a result of these changes, taxpayers with low and middle incomes will be able to save more than 2 billion euros.

Increased deductions

In 2025, changes in deductions for various categories of citizens are also planned:

• New payments for single parents and pensioners have been accounted for.
• The mileage rate for business trips has been increased to 0.50 euros per kilometer.
• An increase in the threshold for small businesses to 55,000 euros is planned.

All these measures are aimed at improving the financial situation of taxpayers and supporting low-income families.

Who benefits from all this?

Support for families and workers

Among the most important groups that will benefit from the new tax changes are:

• Low-wage workers: They will be able to keep more of their earnings thanks to the increased tax-free allowance.
• Families with children: Additional benefits and deductions will make life more comfortable.
• Small entrepreneurs: Higher thresholds and deductions will help them grow their businesses.

This improvement in the tax climate will likely lead to increased consumer spending, which in turn will contribute to the country’s economic growth.

Conclusion

In 2025, Austria is taking significant steps toward improving its tax system. Increasing tax thresholds, eliminating “cold progression,” and supporting families are steps that will help citizens feel financially stable. Taxes in Austria are now fairer and more focused on supporting those who need it most.

If you have any questions or want to learn more about taxes in Austria, feel free to share your opinion in the comments!

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