BUSINESS

OECD expects a slowdown in Greece

PROKOPIS HATZINIKOLAOU

TAGS: Finance

The Greek economy is set to experience a slowdown in the next six to nine months, according to the projections of the Organization for Economic Cooperation and Development (OECD), which also ranks Greece among the countries with the highest tax loads.

According to a report issued on Tuesday by the organization, the signs for the course of the economy in the coming months are quite discouraging, just as Greece needs its gross domestic product to quickly recover the ground lost in the last decade. The OECD warns that its composite leading indicators that reflect the trends for the next six to nine months point to a slowdown in the economies of Germany, France, Italy and Greece.

Regarding last year, the report recorded a declining trend in the Greek economy that started last May and continued up to November, when the latest estimate was made. The reading of the organization’s index, that has a mean rate of 100 points, was 98.42 points in November; this was down 0.13 points from October and 1.76 points from November 2017.

The OECD’s composite leading indicators are designed to highlight the first signs of a swing toward a slowdown or acceleration in economic activity and are based on a wide range of data that historically have pointed to changes in the course of the economy.

The same report also illustrated that taxation in Greece remains particularly heavy and noncompetitive due to the high rates for businesses, without these rates managing to secure higher revenues for the state compared to other countries or the average in European states with lower tax rates.

Between 2000 and 2018 there were corporate tax reductions in 76 countries, while 12 countries kept their rates unchanged and six countries implemented rate hikes of more than 10 percentage points. Greece is among the countries with a significant tax rate rise of five percentage points, from 24 percent to 29 percent, while the average rate in the OECD member-states stands at 21.4 percent.

The income tax declarations that corporations will submit this year will concern their 2018 earnings and will still be taxed at a 29 percent rate, before that drops to 28 percent next year.

Online