Property-related taxes to drop next year

Property-related taxes to drop next year

Property taxation will ease further next year, according to Finance Ministry plans, as the inclusion of new areas in the system of zone rates used for tax purposes (the “objective values” system) is creating some fiscal leeway for interventions as of 2020.

A ministry official has told Kathimerini that the dry run of the new objective values will be completed in May and the result will reveal whether there is any scope for a further reduction in property tax rates. “I have the feeling there will be some fiscal leeway” from this exercise, the ministry official said, assuring that there will be no regressing on the cuts already implemented this year.

The inclusion of 7,000 new areas in the objective values system is expected to fetch revenues of 400-500 million euros, an amount that is absolutely realistic according to ministry sources. The additional revenues to stem from the inclusion of new areas and the increase in the Single Property Tax (ENFIA) due for them will be used to ease taxation on the following:

* Inheritances and parental concessions, with the government examining either the increase of the tax-free threshold from the current level of 150,000 euros, or the reduction of levy rates;

* The rates of the supplementary property tax, with plans including both an increase in the tax-free level and a reduction of rates;

* The ENFIA rates, as the adjustment of objective values will in certain cases lead to an increase in ENFIA dues. In order to avoid any regression on this year’s ENFIA reduction (by 22 percent on average), the necessary adjustments will be implemented to ensure the 2020 tax remains at at least the same level as in 2019, if not lower.

The adjustment of objective values aims to close the gap with market rates. As things stand at the moment, areas likely to see objective value hikes include more than half of central Athens, i.e. neighborhoods such as Exarchia, Kypseli, Ambelokipi, Ilissia and Pangrati, and suburbs such as Maroussi, Halandri, Glyfada and Elliniko.

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