ECONOMY

Entrepreneurs cry foul over 26 pct tax on money sent to states with ‘privileged status’

Local businesspeople expressed strong opposition on Wednesday to the government’s legislative proposal to withhold tax amounting to 26 percent on corporate transactions with companies based in countries such as Bulgaria and Cyprus, asking for its immediate withdrawal. They argued that the clause violates both European Union rules and regulations pertaining to international contracts.

Article 21 of the bill on expired debts to the state provides for Greek enterprises showing money sent to companies based in “non-cooperating” states or in countries with a “privileged tax status” to pay a provisional tax of 26 percent on the payment made. It will then have 12 months to prove that this was a real transaction made on market terms in order to have the tax payment returned.

The Hellenic Federation of Enterprises (SEV) sent a letter to Alternate Finance Minister Nadia Valavani arguing that there are too many such transactions to countries as those described above, and that the measure would also create an unnecessary extra bureaucratic burden on firms.