Prime Minister, Kyriakos Mitsotakis, is set to fulfill one of his pre-election promises, may the most important one that helped him also emerge as the winner of the elections last Sunday: tax relief measures. The plan is top priority for the new Greek government.
A draft has been apparently already worked out and is to reach the Parliament after Mitsotakis announces his government program and receive confidence vote, July 20-22. The tax cuts could be law of the state even before the middle of August.
According to media reports on Wednesday, the relief plan concerns direct and indirect taxes and foresees among others:
Scrapping the trade fee within two years.
Gradual abolition of the special solidarity levy, which is imposed on those with income over €12,000. The special tax was supposed to be abolished in 2014.
Reduction of the tax rate for business profits from 28% currently to 20%. The plan foresees a reduction in the rate to 24% in 2020 and to 20% in 2021.
Suspension of goodwill tax (property adding value).
Corrective regulations for the 120-installment settlement for debtors.
Of these tax relief measures, the 120-installment is reportedly due already in 2019 and the others as of 2020.
Of course, before the tax relief draft is been legislated, Finance Minister Christos Staikouras will have to talk with the country’s lenders.
What is the total cost of the tax relief and how will it affect the target of the primary surpluses?
Government “sources” were telling media that they have thoroughly worked out their plans and are in position to persuade the lenders to accept them.
With cuts in state expenditure “there is fiscal space” for these cuts, they said.
The tax relief package is estimated at 6 billion euros and is to be voted by the new Palriament on August 10.
tax relief sources: ert tv, ant1 tv, newsit
