New debt repayment plans afoot

New debt repayment plans afoot

The government plans to introduce legislation that seeks to simplify the repayment of debts by individuals and businesses to tax authorities, social insurance funds and banks.

The underlying principle of the new framework will be that the number of installments will depend on the income but also on the period when the debt became overdue.

The government wants the new framework for settling arrears to take effect in 2020 and has reportedly already discussed the issue with Greece’s lenders.

According to reports, the government and the institutions are very close to agreeing on the new framework, which, if everything goes as planned, will go into force as of January 1, 2020.

However, both sides agreed that the final decision – which will lead to the submission of the relevant legislation to Parliament – will be made in December, when a better picture emerges regarding the settlement plans that are already in place and the progress of efforts to tackle performing loans (NPLs) through the relevant electronic platform.

The new plan envisages that the exact number of installments to be paid by the taxpayer will range between 12 and 24 on a monthly basis and will depend on the individual’s declared income for the previous year.

For example, individuals with an annual income up to 10,000 euros will be able to pay off debts in 24 tranches.

Meanwhile, the decision regarding an extension to the deadline for people to take part in the 120 monthly installment program will be announced today – the last day for the submission of applications.

By last Friday, 351,128 people had signed up for the 120-tranche program, settling debts of 2.2 billion euros. Together with surcharges of 798.1 million euros, the amount totals 2.99 billion euros.

The amount so far received by the Greek state from those who have paid their first installments of the settlement pan introduced in August and those who have repaid their debts in full has reached 309.6 million euros.

The way things stand now about 500 million euros will have been added to state coffers by the end of the year.

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