Currently, the regime for non-residents is the same as that for residents, which means only 50% of capital gains are taxable and the taxable amount is subject to progressive tax rates.
Portuguese legislation had long been under the scrutiny of the European Court of Justice (ECJ). The first version of the rule in question foresaw that capital gains for non-residents is 100% taxable, unlike tax residents that was only 50% taxable.
With the ECJ Hollmann case, Portugal had to resolve this unjustified discrimination. Thereafter, the law was amended to foresee an optional regime (but only applicable to EU taxpayers). Non-residents could choose between being taxed on 100% of their capital gains at a fixed rate of 28% or, alternatively, on only 50% at progressive tax rates.
Subsequently, this new rule was again subject to the analysis of the ECJ in the MK case, where the Court ruled that this optional regime still did not eliminate the EU law violation.
