NEWS

Gov’t says it can make it alone

Government officials insisted yesterday that Greece can extricate itself from a deepening financial crisis and will not need to resort to a bailout, as a revised tax bill aimed at increasing the burden on higher-income earners was approved by a parliamentary economic affairs committee. «We do not require the activation or further specification of any mechanism,» government spokesman Giorgos Petalotis told reporters, referring to a rescue plan hammered out last month in Brussels that foresees the provision of bilateral loans and International Monetary Fund support in the event that Greece requests it. Petalotis added: «We wanted and still want this mechanism for one specific reason: to act as a guarantee to normalize borrowing conditions. So there is no reason to take any initiative at this point.» He added that Athens was striving to avoid borrowing at «barbaric» interest rates. But Petalotis’s comments and those of European Union officials failed to reassure the global financial markets and Greece’s borrowing costs soared to a record high. Meanwhile visiting IMF officials continued advising Finance Ministry staff on how to improve budget management and crack down on widespread tax evasion. In a related development the revised draft of the government’s tax bill, which aims to shift the burden to high-income earners and abolish a plethora of tax exemptions, was approved by a parliamentary economic affairs committee. The bill contains 23 amendments including the withdrawal of a provision that had foreseen an 8 percent tax on invoices issued by service companies. Opposition New Democracy, which had lobbied for the 8 percent provision to be revoked, voted for a third of the bill’s 91 articles. ND spokesman Panos Panayiotopoulos yesterday hailed the removal of the 8 percent provision, which had provoked an outcry from business representatives, as a «political victory» for the conservative opposition.