BUSINESS

Creating better paid Greek jobs

THANOS TSIROS

TAGS: Economy

One of the government’s big challenges for 2021 is the creation of better jobs for Greeks, and it hopes to achieve this by cutting taxes and social security contributions for employers and employees alike.

The horizontal reduction of contributions and the suspension – at least for next year – of the solidarity levy for all workers in the private sector, regardless of incomes, is set to cut the overall cost for employers while increasing workers’ net takings. Combining this with the coverage by the state of six months’ worth of contributions through the labor subsidy program, the government expects to lay the groundwork not only for job creation but also for the creation of better-paid jobs.

If that goal is achieved, several measures to cut salary costs will end up funding themselves to a great extent: This is because the state may cover six months of contributions, but it will also collect tax that otherwise would not reach the public coffers, while higher salaries also means higher income tax payments.

Notably, the social security contribution reduction has already increased the amount of salaries that the state taxes, thereby expanding revenues.

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