Survival in eurozone requires reforms
Greece has one of the European Union’s most unfair taxation systems and the overall tax burden must be reduced on the basis of objective criteria, Development Minister Akis Tsochadzopoulos said on Monday. «It is my view that we must now reduce the tax burden on enterprises and individuals… The key to making the taxation system more effective is introducing a few – this is the crucial issue – simple and transparent procedures that will apply equally for everyone… I think we are all agreed on this; no privileged or selective relationships with the State,» he said in an address to the General Council of the Federation of Greek Industries (SEV). Tsochadzopoulos said the taxation system was one of four big issues where reform was overdue, along with the social insurance system, investment incentives and measures to promote entrepreneurship. «The necessary prerequisites to achieve high growth rates and the broadest possible employment depend on these four tools, which are the key to further progress toward development,» he said. He noted a continuing fall in subsidies to private enterprise and a need to re-appraise them in view of technological developments. «In an established company, a reduction in taxation is undoubtedly an important incentive. But a new enterprise must make profits before being taxed. It, therefore, requires different help; we may even have to subsidize it to introduce new technology. This is an important incentive, other countries have done it, it is nothing novel,» said Tsochadzopoulos. He said Greece had a special need for measures to promote entrepreneurship, such as those introduced in a recent law. «We have a bigger percentage of self-employed than any other European country. An initiative to promote entrepreneurship, therefore, affects a very large number of Greeks.» Education and training must receive great attention. «In the eurozone of the 21st century, we cannot hope to catch the ‘big fish’ without adapting, immediately and forcefully, the education and training systems for the Greek citizens to the requirements of this development,» Tsochadzopoulos said. He noted that despite high growth rates, an approximately 10 percent annual rise in in investment over the last three years, and falling inflation, deficits, public debt and interest rates, certain problems needed attention: «The continuously worsening terms of external trade is something we cannot be proud of; our exports are only about 28 percent of our imports… Productivity improved only 0.75 percent in recent years.» Productivity is a key factor for Greece to tap the favorable conditions in the eurozone and meet the growth in demand in the internal market, which is of crucial importance.
