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Gov’t cuts lawmakers’ tax breaks, ministers’ salaries by 15%

Finally, good news! In the direction of correcting what we call “social injustice”. That is that while the poor and the needy and the vulnerable society groups are being disproportionally overtaxed, lawmakers and politicians pay less taxes and enjoy tax breaks with ‘whatever’ justification the legislator who introduced this system of privileges had in mind.

The Greek government will slash lawmakers’ tax breaks and ministers’ salaries in a n effective cut of some 20 percent.

According to a governmental non-paper, Prime Minister Alexis Tsipras told his cabinet ministers on Monday, that “The political system must be responsive to the feelings of society.”

Therefore, lawmakers and ministers but also non-elected but appointed ministers and high-ranking officials like General Secretaries will have to pay their share to the crisis.

Tsipras told his ministers that a relevant bill would be submitted “to eliminate tax breaks for lawmakers and rationalize the salaries of ministers and the heads of state organizations and independent authorities.”

“It is a political initiative that has symbolic content, not just economic results,” he said and making with reference to upcoming tax break cut on petrol for farmers, Tsipras added:

“When the issue of scrapping tax breaks for farmers falls on the negotiating table, we cannot pretend not to care about our own tax breaks.”

According to Athens News Agency

1. Lawmakers would no longer benefit from a 25-percent tax break on their salary and a full tax break on payment earned for sitting on parliamentary committees.

2. Ministers, junior ministers and other senior government staff will also see a 15-percent salary cut.

According to government calculations, scrapping the tax break will mean that lawmakers will suffer a 20% salary cut. Non-elected ministers will see their salary decreased by €900, while special and general secretaries will lose €700 per month.

Lawmakers

The gross monthly salary for an MP is €5,705. Another €1,500 comes additionally in times of so-called “constructive periods in the Parliament” when MPs sit in Parliamentary Committees with the effect that an MP can earn €7,200 per month.

Lawmakers pay taxes for only 75% of their Parliamentary income as part of the income is considered to cover office expanses..

With the scrapping of the tax breaks, MPs will earn €5,760 per month.

Ministers & Ministries secretaries 15% cut

A minister who is not member of the Parliament earns €5,700, a ministry general secretary €4,750, a special secretary €4,050. They will all see their salaries cut by 15 percent.

Heads of state organizations and institutions

The salary for heads of state organizations and institutions as wells as for members of the boards will be decreased and reach 80% of the salary of a minister, that is some €3,880 per month gross. There will be no extra bonus for board meetings.

The bill will be submitted to Parliament for voting next week.

PS A Greek government needed 5 whole years of painful austerity for the citizens in order to decrease the salaries of MPs, politicians and officials in public institutions. I still consider their salaries as ‘high’ but nevertheless: Better late than never 🙂

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5 comments

  1. Good (and overdue) step in the right direction! Government should lead by example if they expect others to stop caring first and foremost about their personal well-being and sacrifice for the common good.

    I see two downsides:

    – Missing on some otherwise good candidates (more knowledgeable, better educated, etc.) who are looking for slightly better compensation. I think missing those people is okay, they are not the right people for the job at this point.

    – Increasing incentives to “augment” official compensation by “other means” (trading on inside information, using political connections for personal gains, outright corruption). Dealing with this threat will require increased vigilance on behalf of the authorities (maybe, introducing a tip line for reports of corruption?). Strengthening of anti-corruption legislation could also help if it is inadequate.

    • Missing on some otherwise good candidates

      BS. This is the same reasoning used in Ireland to still pay bankers (who, in the case of Ireland are indeed single-handedly responsible for the mess that country is in) ridiculous wages. The reasoning simply does not hold water, but is of course vigourosly defended by those who get the wages. Maybe we should start applying this to everybody and claim that you can’t find a good teacher, train driver,electrician etc. unless you pay them at least 3,500 a month. Do you expect any opposition from the teachers, train drivers or electricians to that statement? And then, let’s take it another step further. Why not, like we allow our politicians, the workforce of the country to decide on their own wages, tax-breaks, perks and benefits? Suddenly, the equation “right person = ridiculous wage” doesn’t apply any longer. On the contrary. Now we must fofeit collective bargaining, minimum wage agreements etc. in order to push the cost the labour cost down…
      Politicians are the employees of the people, and the last thing they should be allowed to do is decide on their own wage structure without the say-so of the people…

      • I think we are in violent agreement. As I said, “missing those people is okay, they are not the right people for the job at this point”

  2. This sounds good – they will most likely give them shares in the privatized electricty supply – the water supply – the gas – & privatised health – privatized education – so in the end they will be making even more money than now.