BUSINESS

Proposals to overcome economy’s problems

TAGS: Economy

In a report published on Monday, research center DiaNEOsis tables three main proposals aimed at overcoming the main problems hampering growth in Greece.

Those obstacles are interrelated and concern the massive national debt, the problematic social security system and the complex and inoperative tax system. On top of these there are the delays in justice and the complexity of legislation.

DiaNEOsis therefore proposes that the government seek a compromise with its creditors for the country to secure a primary surplus of 1.5 percent of gross domestic product to go toward the servicing of the national debt and another 2 percent of GDP to finance productive investments and innovation.

The second proposal regards the reduction of social security contributions from 20 percent today to 12 percent of workers’ salaries, concerning contributions both by employers and employees.

Finally DiaNEOsis recommends the reform of the tax system, which is currently based on imposing high tax rates as well as unfair indirect taxation. Therefore the report calls for the introduction of a flat 20 percent corporate tax, rates of 20 to 30 percent for annual incomes over 50,000 euros, and a 20 percent top value-added tax rate, from 24 percent today.

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