Lagoa and Olhão have also unveiled their biggest budgets ever
Several Algarve municipalities are announcing their biggest budgets ever, such as Loulé which leads the way with an unprecedented €206 million budget for 2025.
Standing out as the largest municipality in the Algarve by land area and home to the Golden Triangle comprising the luxury resorts of Quinta do Lago, Vale do Lobo and Vilamoura, Loulé approved its budget in a majority vote in the Municipal Assembly in late December.
The budget is described as “very competitive” for companies and “family-friendly”, with housing, education, health, economic prosperity, culture and environmental sustainability highlighted by the local council as some of its priorities.
The largest investment is a €29 million project to build a cutting-edge municipal building near Loulé’s stadium, envisioned as a hub for biomedical sciences research and innovation. The goal is to create an “ecosystem capable of attracting innovative companies and talent and retaining them,” says Loulé mayor Vítor Aleixo.
In education, €3 million has been earmarked for a new daycare facility in Forte Novo in Quarteira, while housing initiatives under the Local Housing Strategy aim to meet the needs of 2,000 families, the council says. One prominent project is the two-phase construction of a residential building in Loulé’s Clona neighbourhood, with a total investment of nearly €19 million.
Other notable projects include a €1.7 million revamp of streets in Loulé’s historic centre, an €8 million public bike-sharing system, and over €3.6 million-worth of investments in digital infrastructure improvements in inland areas, including expanded telecommunications networks and wildfire monitoring systems.
Loulé has also set €2 million aside for projects, backed by PRR funding, to create digital business neighbours (Bairro Comercial Digital) in Quarteira and Loulé, as well as €3.4 million for climate action and biodiversity protection.
Over €42 million has been allocated to sports and cultural projects, headlined by a €16.6 million investment in the ‘Quarteirão Cultural’ project, which aims to “revitalise emblematic spaces of the town”.
Fiscal policies remain family- and business-friendly, the council says, with Loulé maintaining Portugal’s lowest possible municipal property tax (IMI) rate of 0.3%, while offering a 30% property tax cut in rural parishes such as Alte, Ameixial, Salir, Querença, Tòr and Benafim, as well as reductions of €30, €70 or €140 depending on the number of children in a family. The council has also forgone 5% of its share in local income taxes to benefit residents directly and has decided not to charge a municipal business tax (derrama) on taxable company profits, making it more attractive for businesses to operate in the borough.
“Our main goal is to serve people well, working to ensure greater efficiency, effectiveness, and quality in the public services we provide, contributing to greater social justice, and with a deep sense of gratitude for the trust placed in us,” said mayor Aleixo.
Record-breaking budgets have also been announced in Lagoa (over €66 million) and Olhão (nearly €73 million).
In Lagoa, the bulk of the investments involve replacing key pipelines, addressing pressing issues of water efficiency while continuing to expand its housing initiatives, from building new houses to purchasing properties to rehabilitate and put at the service of the population. Lagoa’s local authority also highlights ongoing investments in education, culture, social services, and sports.
“Approving the largest budget the municipality has ever had is a huge responsibility,” Lagoa mayor Luís Encarnação admitted, adding that the council has “already proved it is up to the challenge.” He also said that the budget aims to continue modernising Lagoa, making it more sustainable and better prepared for the demands of the modern world. “It prepares Lagoa for the big challenges of the future,” Encarnação added.
Similarly, Olhão has set a new financial benchmark with a nearly €73 million budget, a 14.7% increase from the previous year. Priorities include housing, education, health, and environmental sustainability, although funds have also been set aside for key areas such as sports, culture, mobility and transports.
“We have to create better conditions for our citizens, but we also have to generate wealth,” said Olhão mayor António Pina, stressing the council’s commitment to supporting the creation of new companies and job opportunities. The municipality also plans to modernise its administrative infrastructure, including a new Loja do Cidadão (Citizen’s Office).
