On the surface, the latest income statistics offer encouraging news for the Azores. The archipelago’s taxpayers reported a median net income above the national average in 2024, placing the Region among Portugal’s most prosperous sub-regions. Yet beneath that positive headline lies a more sobering reality. The same figures also reveal that the Azores remain one of the country’s most unequal regions, where economic gains are distributed far less evenly than the national average.
The findings, released by Portugal’s National Statistics Institute (INE) in its Local Income Statistics report, are based on tax information supplied by the Portuguese Tax Authority and provide one of the clearest portraits yet of the Region’s evolving economic landscape.
After deducting Personal Income Tax (IRS), the median declared income in the Azores reached €12,565 per taxpayer in 2024, surpassing the national median of €12,316 by approximately two percent. Among Portugal’s 26 NUTS III sub-regions, the Azores ranked fifth, trailing only Greater Lisbon, the Setúbal Peninsula, Madeira, and the Coimbra Region.
The figures suggest an economy that continues to generate comparatively strong incomes despite the structural disadvantages of insularity, higher transportation costs, and geographic isolation. Six Azorean municipalities also recorded median incomes above the national benchmark, placing them among just 74 municipalities across Portugal to achieve that distinction.
Within the archipelago, Ponta Delgada registered the highest median income, while Vila Franca do Campo recorded the lowest among the municipalities for which data were published.
Yet income levels tell only part of the story.
What makes this statistical portrait particularly revealing is the contrast between prosperity and distribution. Although median incomes exceed the Portuguese average, wealth is concentrated far more unevenly across the islands than elsewhere in the country.
The principal measure of this imbalance is the Gini coefficient, the internationally recognized indicator of income inequality. Measured on a scale from zero—representing perfect equality—to one hundred, where all income belongs to a single individual, the Azores recorded a Gini coefficient of 36.6 percent, a full percentage point above the national average of 35.6 percent.
That result places the Azores as the second most unequal sub-region in Portugal, surpassed only by Greater Lisbon, whose concentration of wealth reached 38.9 percent. Madeira followed closely behind with 35.9 percent, while the Porto Metropolitan Area matched the national average. At the opposite end of the spectrum, Central Alentejo recorded the country’s lowest level of income inequality, at 30.9 percent.
The disparities become even more striking at the municipal level.
Four Azorean municipalities—Vila do Porto, Lagoa, Vila Franca do Campo, and Ponta Delgada—registered inequality levels above the Portuguese average. The most dramatic case was Vila do Porto, on Santa Maria Island, whose Gini coefficient reached 42.3 percent, making it the second most unequal municipality in Portugal. Only Lisbon recorded a higher level of income concentration, at 42.9 percent, while Vila do Porto exceeded both Porto (42.0 percent) and Cascais (40.5 percent), municipalities more commonly associated with significant disparities in wealth.
Within the Azores, Madalena, on Pico Island, emerged as the municipality with the lowest measured income inequality among those for which statistics were available, offering a notable contrast to the concentration of wealth observed elsewhere in the Region.
The year-to-year evolution also presents a complex picture.
In both Ponta Delgada and Vila Franca do Campo, inequality not only remained above the national average but increased between 2023 and 2024, placing both municipalities among just fifteen across Portugal where income disparities continued to widen.
Conversely, Povoação experienced the most significant improvement in the entire country. Its Gini coefficient fell by 2.3 percentage points, the largest reduction in income inequality recorded by any Portuguese municipality, narrowly surpassing Mesão Frio, which registered a decline of 2.2 percentage points.
These contrasting trajectories underscore the increasingly uneven character of economic development within the archipelago itself.
The figures also invite a broader reflection on the meaning of prosperity.
Median income is often interpreted as evidence of economic success because it reflects the earnings of the taxpayer positioned at the center of the income distribution. However, it says little about how income is shared among the broader population. A region may exhibit relatively high median earnings while simultaneously experiencing significant disparities between its highest and lowest earners.
That appears to be the paradox confronting the Azores.
Strong agricultural exports, sustained tourism growth, public investment, and expanding service industries have undoubtedly contributed to rising incomes across much of the Region. Yet the benefits of that economic progress have not been distributed evenly. Certain municipalities and sectors have advanced more rapidly than others, while geographic isolation, demographic change, housing pressures, and differences in employment opportunities continue to shape unequal outcomes across the islands.
The INE also cautions that the indicator it refers to as “net income per person” should not be confused with household disposable income. The calculation represents declared gross income after deduction of assessed personal income tax and excludes undeclared income, social benefits, additional taxes, contributions, and other elements that influence the actual financial circumstances of families. Moreover, the statistics include only tax units reporting positive income after IRS and are published at the municipal and parish level only where there are at least 2,000 taxpayers, ensuring statistical reliability.
Ultimately, the latest figures reveal an economy of contrasts. The Azores can rightly celebrate having a median income above the national average, a notable achievement for an Atlantic archipelago often defined by the challenges of distance and scale. At the same time, the data serve as a reminder that economic growth alone is not the ultimate measure of prosperity. The true test lies in how broadly that prosperity is shared. For the Azores, the challenge in the years ahead will not simply be to continue generating wealth, but to ensure that its benefits reach every island, every municipality, and every community with greater fairness and cohesion.
Based on a story in Diário dos Açores- Photo from the Municipality of Ponta Delgada.