Who benefits from the solidarity levy cut
The professional categories to enjoy increased incomes through the suspension's extension
The maintenance of the escape clause from the high primary surplus target for next year as well has allowed the government to continue to hold off the solidarity levy for private sector salary workers, freelance professionals, landlords and dividend recipients.
That means this year’s increase in earnings (through the suspension of the levy, and possibly the reduction of social security contributions by three percentage points) will be extended for another year. More than 1.2 million taxpayers stand to benefit from the levy’s suspension and the contribution cut in 2022, with the cost for the budget amounting to 1.5 billion euros.
The professional categories to be relieved of the solidarity levy next year too are the following:
– Private sector salary workers, for incomes from January 1 to December 31, 2022. However, this exemption does not apply to taxpayers found to have assets (“tekmiria”) that are not justified by their declared incomes for the last couple of years.
– Farmers and freelance and self-employed professionals, for their 2021 incomes that will be declared in 2022.
– Those with income from rents, and those who collect dividends. For instance, a landlord receiving €25,000 per year from rents will have an extra €426.
The solidarity levy was introduced in 2011 on incomes of more than €12,000 per year for individuals; it should have been abolished at end-2014. In total, individual taxpayers pay some €1.2 billion per year, while in previous years (such as in 2014) the sum exceeded €1.5 billion.
That development is set to ease the pressure mainly on middle incomes, which in previous years bore the brunt of the fiscal adjustment.
For the calculation of the levy the state takes into account the total annual net income of each taxpayer. The levy is not imposed on the long-term unemployed registered with the Manpower Organization (OAED) and those receiving unemployment benefits as long as they do not have any other real incomes in the period they receive it.