More Net Income from Gross Starting 2026: What Will Change!

The income tax reduction from 2026 is expected to bring significantly more net income from gross for thousands of employees.

From the year 2026, another adjustment of the income tax table is pending. According to forecasts based on rolling inflation, the tax brackets are expected to rise by 1.75 percent, as reported by finanz.at. For many employees, this means: less tax burden, more net income.

Tax Brackets Rise – Relief for Middle Incomes

The increase in threshold amounts affects all income levels up to the top tax rate of 55 percent, which applies to an annual income of over one million euros. The tax exemption threshold will thus be raised to an estimated 13,541 euros. This means smaller incomes remain tax-free, while middle incomes benefit from lower effective tax rates due to the new brackets.

This is What the New Income Tax Table Looks Like

The anticipated income tax table from 2026 is based on an inflation adjustment of 1.75 percent – two-thirds of the inflation rate of 2.63 percent in the period from July 2024 to June 2025. The third third of the inflation is disregarded due to budget savings. The top tax rate remains unchanged.

Official Decision Still Pending

Although the figures have already been calculated, a final decision by the federal government is still pending. However, implementation is considered likely, as the system of "cold progression" has been mitigated by automatic adjustments since 2023.

Cold Progression: What Was Planned for 2025

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