ECONOMY

Tax relief extended to May ’21

tax-relief-extended-to-may-21

The government has extended the suspension of the obligation to pay taxes due during last March and April to the end of April 2021.

A blanket lockdown was imposed in mid-March, during the first wave of the coronavirus pandemic, and continued through April and part of May, bringing a good chunk of economic activity to a standstill.

Individuals, independent professionals and businesses especially hard hit by the pandemic had been exonerated from paying taxes due during these specific two months until the end of August.

The extension of the measure was announced yesterday by Deputy Finance Minister Apostolos Vessyropoulos.

His boss, Finance Minister Christos Staikouras, had already mentioned the extension, which was made official on Friday. 

Beginning in May 2021, those taxpayers benefiting from the measure will be able to pay these due taxes in 12 monthly installments, interest-free, or 24 installments, with a 2.5% interest rate.

“The government is making a decisive move to support those individuals and corporations hit by the consequences of the pandemic,” Vessyropoulos said.

“Paying these due taxes had already been postponed, because [payment suspension] was one of the first measures we took and then updated, as needed,” he added.

The extension was made as the government was aware that there is little hope of recovering due taxes in this economic climate. It is also thinking of providing tax incentives to property owners to continue cutting rents to businesses. For some kinds of businesses, mandatory rent cuts will be extended.

Greece is expected to post a primary budget deficit, which excludes interest on its debt (of over 5% of GDP in 2020), instead of the planned 3.6% primary surplus. And, although the European Union has suspended its fiscal rules for 2021 as well, and the country is no longer obliged to post a surplus, it would like to show its European partners, and creditors, that it has boosted revenue in 2021.