The Economy Ministry is promoting incentives to entrepreneurs in the form of tax exemptions and an accelerated repayment process for enterprises that have taken out loans of 600 million euros that the state is now bound to cover due to previous subsidy laws. This will be done through a bill aimed at boosting investments and fortifying troubled entrepreneurship in Greece.
In the next few days Economy Minister Giorgos Stathakis will put a draft law up for consultation that will provide for tax breaks that will be the equivalent of up to 130 percent of the state subsidies companies receive, so as to strengthen the incentives for potential investors. It will also provide for a stable taxation status for seven years and a tax rate at the current level of 29 percent, with a pledge not to increase it regardless of any possible negative developments in the country’s economy.
If financial conditions allow for it, any reduction to the tax rate will also apply to the enterprises that are granted the new investment status.
The ministry is undertaking an important initiative in cooperation with the Hellenic Bank Association for the repayment of loans investors took out in accordance with previous investment incentive laws dating from 2004 and 2011.
The general secretary for strategic and private investments, Lois Lambrianidis, explained that this concerns loans adding up to 600 million euros provided by banks to cover the private participation in investments that had previously received approval for state subsidies. However, the state failed to pay out the subsidies, so investors have not only received none of the money they qualified for, but also owe money to the banks. The solution being examined concerns the coverage of those amounts through bonds to be given to banks.
There are similar measures under examination for other enterprises that have taken advantage of the older laws, regarding the provision of tax exemptions instead of the subsidies the state owes or by offsetting the value-added tax due. It is estimated the total debts of the state from unpaid subsidies add up to around 3 billion euros, concerning some 4,000 investment projects.