ECONOMY

In Brief

New ‘blanket’ tax absolution for small firms and self-employed The Finance Ministry is hoping to collect 1.6 billion euros from an estimated 800,000 firms and self-employed professionals who may opt for an irrevocable tax settlement of non-inspected fiscal years 1999-2001 on the basis of a «blanket» standardized formula, according to a draft bill released yesterday. The minimum tax thus determined is 250 and 500 euros for small firms and the self-employed respectively, while larger firms’ minimal tax will represent 0.2 percent of gross revenue. The measure concerns businesses with an annual turnover of up 8.8 million euros, while a senior official said «it does not concern the small self-employed professionals but mainly those who have huge incomes that they hide from tax authorities.» Businesses that have not settled through similar arrangements in the past, including those with pending legal cases, will be asked to give notice of acceptance of the measure, without the involvement of a tax official. Separately, taxpayers who failed to file their annual income tax returns for 2003 in time, have been given an extension until July 30. Inflation slows down in June projected to remain stable in July Greek inflation slowed to 2.8 percent year-on-year in June from 2.9 percent in May, National Statistics Service (ESYE) data showed yesterday. «There was a slight drop in fuel prices and a big fall in vegetable prices (in June),» said ESYE Secretary-General Manolis Kontopyrakis. «Based on data to date, there doesn’t seem to be anything significant that could affect inflation positively or negatively.» ESYE projects inflation to remain at the same levels in July. According to the data, in a sample of 82 hotels, prices remained unchanged in half of them, while the rest recorded increases by up to 44 percent. Mutual funds The European Commission yesterday warned Greece to abolish tax discrimination against mutual funds based in Switzerland, Lichtenstein, Norway and Iceland, the remaining member states of the European Free Trade Area (EFTA) that have joined the European Economic Area (EEA) and must be treated equitably with members of the European Union. Only capital gains from the sale of Greek mutual funds were free of tax until December 2002, when legislation was amended to also cover those based in the other EU members. The amendment left out the four EFTA members, whose mutual funds continue to be taxed if liquidated. In the opinion sent to the Greek government, the Commission warned it may refer the country to the European Court if the situation is not rectified in the next few months. Investment incentives Economy Minister Giorgos Alogoskoufis said yesterday he will temporarily reactivate the 1998 law on investment incentives, as the one enacted by the preceding government earlier this year contains many provisions contrary to EU legislation. He said a new incentives law will be tabled in Parliament at the end of fall. Petrom Romania said yesterday it clinched a deal with Austria’s OMV on the sale of its national oil company SNP Petrom. «Negotiations have been concluded,» a government spokeswoman told reporters in Bucharest. (Reuters)