BUSINESS

Tax increases lead to smaller state revenues

THANOS TSIROS

TAGS: Finance, Taxation

Behind the “success stories” of primary surpluses and the social dividends lies the fact that the overtaxation of Greeks has resulted in a shortfall of public revenues. Earnings from direct and indirect taxes missed their targets this year despite hikes in rates, while in some cases they even dropped below last year’s figures.

Though having promised to protect low-income households while in opposition, SYRIZA has since imposed the highest rate of indirect taxes in the last decade, amounting to 15.1 percent of the gross domestic product.

Direct taxes this year are bringing in just 17.59 billion euros according to the latest data, against 19.25 billion in 2016, a significant drop of 1.66 billion euros. This drop comes despite additional taxes that are expected to reach up to 1 billion euros.

Corporate taxes, meanwhile, were supposed to fetch 3.04 billion euros but the latest estimate has brought this figure down to 2.81 billion, against 3.18 billion last year.

The solidarity levy had brought in 999 million euros in 2016. The brackets changed for this year and the target was set at 1.114 billion euros, but the charge will eventually bring no more than 1 billion euros at best.

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