Economic team finalizing package of tax reliefs for Tsipras’s TIF speech

Economic team finalizing package of tax reliefs for Tsipras’s TIF speech

The government's economic team is reportedly finalizing a package of measures for Prime Minister Alexis Tsipras to announce at his keynote speech at Thessaloniki's International Fair on Saturday evening, which will utilize the record surpluses forseen in the last bailout program, boost SYRIZA's leftist profile but not draw the ire of the institutions.

According to information, among the measures expected to be announced by the Premier are:

– Abolishing the sub-minimum wage for youngsters aged up to 25 years, with a simultaneous reduction of social security contributions, as an incentive to help them enter the labor market.

– Lowering social security contributions for the self employed from 20 percent to 13.3 percent for a main pension.

– Accelerating the reduction of the corporate tax rate from 29 percent to 26 percent. This measure was envisaged as a counterweight to the reduction in the tax-free threshold and was going to be implemented gradually from 2020, but the government might decide to bring it forward.

– Gradual reduction of the higher VAT rate of 24 percent as of 2020. According to the same information, it appears that an initial plan to reduce VAT on the catering sector will not proceed.

– Reducing the property levy ENFIA up to 30 percent. The reduction will be higher in poorer areas. It is estimated that these changes will reduce the state's revenues from ENFIA by 250 million euros, or 10 percent. The revenues currently stand at 2.65 billion euros.

Concerning the much-discussed government plan to scrap an agreed reduction in pensions as of 2019, sources said the prime minister may choose to avoid mentioning the issue which is bound to cause negative reactions in the EU and among the institutions while negotiations are underway to discuss Greece's 2019 budget. 

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