Taxation of Severance Packages: Government's Strategy for Social Justice
July 24, 2025
The government plans to tax generous severance packages exceeding a certain amount in order to achieve social justice. Severance payments up to 20,000 euros will be tax-free, while the remainder will be taxed at a rate of 20%. This decision targets excessively large severance payments given to employees in the past. The government believes that this measure ensures equality and does not impact the broader taxpayer base.