FINANCE

Optimism from tax takings

Budget data for November point to some space for extra support by the Finance Ministry

optimism-from-tax-takings

Revenues have exceeded their November target, official data showed on Wednesday, promising that the gross domestic product will see greater growth this year than the 6.9% forecast, and some extra scope for tax breaks.

Tax revenues came in 855 million euros over the target in the first 11 months of the year, with November accounting for an overshoot of €690 million.

“The increase in tax revenues, compared to budget forecasts, continued in November too, which confirms the faster-than-projected recovery of the economy, as has also been recorded by Hellenic Statistical Authority data,” Alternate Finance Minister Thodoros Skylakakis stated.

A senior ministry source added that “should there be any revenues off the budget, there will also be some scope for off-budget support.”

The same source clarified that as far as support measures are concerned, the government is considering how to tackle increased energy rates next year. For that purpose it is planning to activate a permanent mechanism that will offset the fluctuations of wholesale rates for consumers; that mechanism will last for at least a decade, explained the ministry source. The rise in tax takings to 4.42 billion last month is mainly attributed to corporate taxation and consumption taxes, and to a lesser extent to the tax individuals pay. That also matches the figures on the course of online transactions, which have shown a constant increase, by 30% in November, 37% in October and 34% in September in comparison with the same months before the pandemic (in 2019).

The same ministry official referred on Wednesday also to the increase of the minimum wage, noting that the government pledge about its rate being twice as high as GDP growth concerns the comparison with 2019, and not last year with its special conditions. Therefore, if the GDP rises to €187 billion in 2022 from €183 billion in 2019, there will be a 4.2% rise, while if it climbs to €190 the increase will amount to 7.8%.