NEWS

PM eyes larger surplus; might give portion to flood victims, middle class

TAGS: Politics, Economy, Society

With this year’s primary budget surplus set to far exceed expectations, Prime Minister Alexis Tsipras will have a significant buffer, in addition to the 1.4 billion euros he pledged last week in handouts to Greeks on low incomes, to offer other social groups, Kathimerini understands.

According to sources, the fiscal surplus for 2017 is expected to hit 3.1 percent of gross domestic product, far above the original target of 1.75 percent of GDP set by Greece’s international creditors.

If this higher target is clinched, it would yield between 300 and 700 million euros, according to current estimates.

Tsipras is expected to offer this additional sum to those Greeks whose homes or businesses were damaged or destroyed in last week’s flash floods in western Attica.

Further, a portion of the sum might be given to middle-income taxpayers with annual earnings in the 20,000-30,000-euro bracket – in a bid to fend off criticism from the political opposition that the budget surplus was effectively raised through the overtaxation of the Greek middle class. 

There are some within the ranks of the government who believe that a wiser course of action would be to keep the additional cash as a buffer in state coffers.

In any case, Tsipras will wait for the green light from representatives of Greece’s foreign creditors who are due to return to Athens this month to resume their latest review of the government’s implementation of structural reforms tied to the country’s third bailout.

Tsipras announced the 1.4 billion euros in handouts last week in an apparent bid to show that his leftist-led coalition is giving something back to austerity-weary Greeks who, while in opposition, he had pledged to relieve. However, the move was also widely interpreted as an attempt to distract public opinion from a series of political problems, such as a controversial sale of Greek missiles and bombs to Saudi Arabia.

A bill with details of the distribution of the 1.4-billion-euro surplus is to go before a vote in Parliament today and is expected to pass with the support of coalition lawmakers.

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