Tax deposit to be cut by up to 80%
The government is considering a corporate income tax deposit rate that will be “a la carte,” depending on the damage to each corporation’s revenues from the coronavirus in 2020, and on the course of the pandemic by end-July or end-August.
That is the main scenario ahead of the submission to Parliament of the amendment concerning the tax deposit rate for this year’s processing of company tax statements. The final rates are yet to be decided, but the Finance Ministry is pondering a cut from the current level of 100% (whereby companies pay their entire tax for next year a year earlier based on projections from previous years) to below 50%. Sources say this may even come to just 20-30% in cases of companies that have experienced a major slump in revenues and therefore in earnings.
The treatment of enterprises on a case-by-case basis regarding the particularly important matter of the income tax deposit will resolve several problems, reducing the tax burden on corporations that are hurting and shifting fiscal space from this year’s budget (that will show a deficit anyway) to that of 2021.
Hellenic Statistical Authority data show most firms saw a revenue drop over 50% this spring.