Easing the pressure on taxpaying households and businesses is the top priority for Greece’s new finance minister, Christos Staikouras said on Tuesday as he took over the portfolio, adding that this will be evident in the first tax bills later this month.
Straight after a vote of confidence in Parliament on July 22, the Finance Ministry will table a new tax bill whose cost is seen coming up to 6 billion euros over the next three years. The bill is expected to be voted into law by August 10.
Sources say the draft law will include all the amendments and measures that New Democracy had promised before the election, such as change to income tax rates for corporations and households, and a reduction to the rates of the Single Property Tax (ENFIA) and value-added tax (VAT). Apart from the reduction in tax rates, amendments will also include the maintenance of the income tax-free ceiling at 8,636 euros per year.
Once the bill goes through, lowest income bracket will pay income tax of 9 percent instead of 22 percent today, meaning that a salaried worker without children and an income of 10,000 will pay tax of 122.76 euros instead of 300 euros as it stands today.
The bill will also suspend capital gains tax on property sales and VAT on construction activity, the reduction of the levy for exercising a profession by 50 percent next year and its abolition in 2021, the gradual abolition of the solidarity levy and the halving of dividend tax from 10 percent to 5 percent as of 2020.
Staikouras is likely to meet with the heads of the country’s creditors next week on the sidelines of the annual Economist conference in Athens. This is expected to feature speeches by the heads of the European Stability Mechanism (ESM) and the Euro Working Group, Klaus Regling and Hans Vijlbrief, the chief representative of the International Monetary Fund in Athens, Peter Dolman, and the head of the ESM mission in Greece, Nicola Giammarioli.
The ministry’s new leadership plans to meet with all those officials and present them the new tax bill, as well as possibly discussing next year’s budget plans.