FINANCE

Debt payments in 72 tranches

New measures will extend income tax discount for immediate settlement to end of August

debt-payments-in-72-tranches

The Finance Ministry is bringing to Parliament on Thursday a set of measures aimed at easing pressure on taxpayers and businesses, headlined by a debt repayment scheme of up to 72 monthly installments.

Along with the new debt payment plan, the ministry will extend the 3% discount on one-off income tax payment until the end of August, from end-July, reduce the value-added tax on defibrillators to 6% and extend the period of the reduced tax rate of 13% on sports event tickets until end-June 2022.

The proposed settlement of dues will be between 36 and 72 monthly tranches. It will concern debts by individuals hurt by the pandemic and created during the last year-and-a-half, and have a minimum installment amount of 30 euros for debts up to €1,000 euros and €50 for dues in excess of €1,000. The measure will also concern landlords who saw their rental revenues drop, the unemployed registered with the Manpower Organization (OAED) and workers on furlough or supported by the “Syn-Ergasia” subsidy program.

Eligible for the new payment plan are recent debts (VAT, the 2020 income tax and ENFIA, etc.) and social security dues created since March 2020. They can be repaid in up to six years at an interest rate of 2.5%, starting from January 1, 2022, or in three years (36 tranches) interest-free. Choosing even one more tranche above the limit 36 will incur interest on all the installments.

Notably, this year’s income tax and ENFIA are not eligible for this arrangement as they are not considered overdue yet.

Out of the approximately 2 million potentially eligible taxpayers, with proven losses due to the pandemic, a total of 823,435 have debts to the state for the period in question. They are 134,455 corporations, 392,785 individuals with a business activity, and 299,195 other individuals.

Their eligibility is confirmed via the Activity Code Number (KAD) in its expanded form for corporations and self-employed professionals, and the registers of OAED and the Labor Ministry.