The taxation bill which the government will submit to Parliament early next month is likely to contain additional breaks for wage and salary earners beyond those already announced, sources said. It will also provide for an increase in the special tax-free ceiling for disabled people. The general guidelines of the bill were presented at a meeting chaired by Economy and Finance Minister Giorgos Alogoskoufis. As regards salary earners and pensioners, the tax-free ceiling is raised from 11,000 to 12,000 euros for 2007 incomes, with a simultaneous trimming of tax rates. In particular, incomes up to 30,000 euros will be taxed at 29 percent (against 30 percent today), incomes thereafter up to 100,000 euros at 39 percent and above that at 40 percent. The 15 percent rate, to date applicable to incomes of up to 11,000 euros, is abolished for salaried people and pensioners, as the tax-free ceiling is raised. For the self-employed, the tax-free ceiling is raised from 9,500 to 10,500 euros, but the 15 percent rate will be retained for the narrow band between 10,500 and 12,000 euros – instead of up 13,000 euros presently. The basic 29 percent rate will be reduced to 27 percent for 2008 incomes and to 25 percent for 2009. The top 39 percent rate will come down to 37 percent in 2008 and to 35 percent in 2009. There will be no gradual reduction in the 40 percent rate. Alogoskoufis is also due to receive by the end of the month a ministry report on the efficacy of granting additional tax discounts to salaried people and pensioners. The same sources said the discounts will be about 35 percent of sums paid for medical expenses and private school fees and 60 percent of amounts paid for life insurance premiums. These would raise the maximum discount from 220 euros presently to 300 euros for medical expenses and from 1,100 to 1,800 euros for insurance premiums.