ECONOMY

Debt payment plans put on ice

debt-payment-plans-put-on-ice

The government appears to be shelving its plans for the restructuring of debts to the tax authorities and social security funds, according to the European Commission’s report on Wednesday, even though officials in Athens had consistently said over the last few weeks that the clauses related to those plans would be voted immediately and start applying within March.

Labor Minister Effie Achtsioglou and her alternate, Tasos Petropoulos, deliberately presented the clause for the social security dues as being virtually ready; it would have benefited hundreds of thousands of self-employed professionals, farmers and freelancers, allowing them to restructure their debts to the funds through more tranches and to have their original dues and penalties reduced. In recent days there were even leaks about the ministry examining the inclusion of the debts not only of individuals but also of corporations.

At the same time Deputy Finance Minister Katerina Papanatsiou presented a similar regulation for debts to tax authorities as almost ready for submission in Parliament, although Minister Euclid Tsakalotos was more cautious.

While within the country the twin government interventions grabbed the headlines on an almost daily basis, the European Commission report on the European Semester said that Athens has informed the European institutions that it does not intend to proceed to a revision of the installments system for tax and contribution arrears in the near future as it requires further analysis.

The Commission notes that this is important for the purpose of averting negative risks related to public revenues and safeguarding the payment culture. It specifically states that the new tranche schemes for up to 120 installments could have negative consequences on public revenues and the primary surplus.

After the publication of the report in Brussels, Labor Ministry sources admitted that time is needed for certain technical details, while insisting that the new payment plans will soon be introduced in the context the ministry’s leadership has decided.