PASOK wants heavier taxes on the rich
Greece’s socialist opposition PASOK will tax the rich and spend more on social programs if it returns to power in forthcoming general elections, party leader George Papandreou said yesterday. The ruling conservatives had created growing inequality in Greek society while failing to deliver the structural reforms they promised when they came to power in 2004, he said. «The richer must be more heavily taxed,» Papandreou told Reuters in an interview. «They (the government) have hurt ordinary people – there is a lot of poverty in Greece.» Opinion polls show Prime Minister Costas Karamanlis and his New Democracy party just ahead in opinion polls, benefiting from strong economic growth and falling unemployment. An election must be held before March next year but some government officials indicated that Karamanlis might call a snap poll as early as this summer. Papandreou backed bringing elections forward because the Socialists saw evidence that the public mood was changing in their favor. «The sooner the better,» he said. «This election is up for grabs.» Both parties have already begun preparations for what is likely to be a close race. The conservatives are promising more pro-business reforms and personal income tax cuts. They also promise to continue efforts to reduce Greece’s huge debt, equal to the value of its annual economic output of -200 billion ($260 billion). The government has cut the budget deficit to below European Union limits after Brussels put the country on its black list for overshooting significantly in 2001-2004. Papandreou said the Socialists would also pursue fiscal consolidation but would try to emulate the «Scandinavian model» of pro-business policies combined with solid welfare. His government would introduce a capital gains tax as one of the measures to bridge the gap between the poor and the rich. «We need reform but not in the way which would create more inequality,» he said. His government would also consider cutting military spending, among the highest in the world in relation to gross domestic product, but only if the gradual improvement in relations with former archenemy Turkey continued in coming years.
