BUSINESS

Excessive taxes funded the government's Christmas handouts

PROKOPIS HATZINIKOLAOU

TAGS: Finance, Taxation

The increased taxes on corporations and households, as well as higher consumption taxes, brought the Greek economy to its knees last year, according to the definitive data for the 2016 budget that the Finance Ministry released on Tuesday.

The surplus in tax revenues compared to the target set for last year, which came to 1.7 billion euros, resulted from the hikes in value-added tax (VAT) rates, the abolition of the VAT discount on many Aegean islands, the new income tax rates, the increase in the solidarity levy, and the rise in the special consumption tax rates on cigarettes and heating oil.

The additional taxes people and companies paid (compared with the target) financed the handouts to pensioners just before Christmas.

The data highlight the excessive taxation on corporations during 2016 in comparison with 2015, a phenomenon expected to grow further this year. Businesses paid 37 percent more tax (or 1.074 billion euros) from 2015, while households paid 354 million euros more than the year before.

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