BUSINESS

Tax to ease for middle incomes

SOTIRIS NIKAS

TAGS: Taxation

The government’s latest proposals for the reform of Greece’s tax system would entail an extra burden on those with the lowest and the highest incomes, while those in the middle – salaried workers and pensioners earning between 28,000 and 40,000 euros per annum – would see their tax decrease. However, the changes to the income tax and the solidarity levy have not been set in stone as the country’s creditors are continuing to press for a more drastic drop in the tax-free ceiling than what the government has proposed.

People on low incomes who until today were covered by the tax-free level of 9,550 euros will now have to pay tax of about 100 euros per annum. If the creditors have their way, those in the lowest income bracket will have to pay even more tax, as the former want to see a decline in the tax-free level.

People on incomes of between 9,000 and 27,000 euros per year will pay between 8 and 176 euros more in taxes. The lowest increase, of 8 euros, concerns those on incomes of 27,000 per year, while those earning 25,000 euros will pay an additional 176 euros.

Salary workers and pensioners with incomes of between 28,000 and 40,000 euros will see their taxes reduced by between 76 euros (for 28,000-euros-per-year incomes) and 399 euros (for the incomes of 35,000 euros).

Those on 40,000 euros upward will see their taxes climb, with earners of 45,000 euros per annum having to pay 101 euros more and earners of 100,000 euros per year having to fork out an extra 3,851 euros.

Finance Ministry officials stress they will not accept a greater drop in the tax-free ceiling than the 9,090 euros the government has proposed to the creditors. They also say that there will be no more changes to income taxation, given that the proposed amendments to the system will bring additional revenues of 1.8 billion euros per year, i.e. the desired 1 percent of the gross domestic product.

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