Finance Minister Yanis Varoufakis presentation of “creative vagueness” whet the appetites of Greece’s international creditors from the European Commission, European Central Bank and International Monetary Fund. They appear to have insatiable appetites that cannot be satisfied with the retention of the single real estate tax (ENFIA), abolition of VAT on islands as well as VAT hikes to as much as 23% on certain products, pension cuts and the abolition of the Social Solidarity Pension Fund (EKAS), business hikes and more taxation for farmers, etc. The final round of negotiations takes place at a new Eurogroup meeting after Wednesday’s meeting ended without an agreement as differences between Greece and creditors persist.

The Wall Street Journal on Wednesday showed the document that showed the still-major disputes between Greece and its creditors so that Athens can return to financial health and reduce the debt load worth 180% of its GDP (CLICK HERE to read the document).

Lingering differences concern a gap worth 2.3 bln euros that creditors want while dismissing a series of measures proposed by the government to gather 6 bln euros:

– 700 mln euros difference from VAT

The Greek side has managed to line state coffers with 680 mln euros for this year and 1.360 bln euros for 2016 – meaning a total of 2 bln euros. Creditors want measures to yield 900 mln euros for this year and 1.8 bln euros for 2016 (a total of 2.7 bln euros).

A solution:

a) Creditors want VAT to increase to 23% for dining and catering, but the Greek government is battling to avoid this and keep levels at 13% for a limited group of products including energy, basic food items, catering and hotels.

b) Creditors want 13% VAT rates only on processed food and 23% on the rest. The government wants to separate food items into “basic” and “non-basic”. If the Greek government adheres to the creditors wishes there will be 23% VAT on milk and olive oil.

c) A 45% increase to VAT on islands. Both sides have agreed to this, meaning that the 30% VAT exemption for Aegean islands will no longer apply, lining state coffers with 347 million euros a year (520 million euros by the end of 2016). Creditors have refused the government’s proposal for special tax exemptions for islanders that would result in a return of 50-100 million euros per annum (75-200 million euros by the end of 2016).

– Additional taxes worth 1 billion euros by 2016

Measures called for by Greece’s creditors are aimed at gathering 300 mln euros for 2015 and 700 mln euros for 2016. Specifically:

a) Solidarity contribution: The IMF is calling for an increase (with the abolition of the 30% reduction) for all taxpayers who earn more than 30,000 euros as well as those who earn 12,000-30,000 euros per annum.

b) Tax hikes: The IMF is calling for an increase to income tax payments for 2016 for businesses and the self-employed from 55% to 100% as well as increases from 80-100% for Private Liability corporations.

c) Business tax: The IMF is calling for a tax hike from 26% to 28% rather than 29% that the Greek government is suggesting.

d) Abolition of tax exemptions in agriculture: The IMF does not want tax exemptions to be offered to farmers for farming fuel and wants subsidies to be scrapped.

e) Retention of the single real estate property tax to yield 2.65 billion euros. The Greek side agrees and has pledged to increase contributions if objective property values are lowered.

– Funding cutbacks worth 600 million euros

a) Defence funding: The IMF is calling for defence cuts worth 400 million euros rather than the 200 million euros that the Greek plan proposes.

b) The abolition of the Social Solidarity Pension Fund (EKAS) and its replacement at the end of 2017.

– Pensions and Contributions

Creditors want

a) Withholding 6% contributions to cover health expenses from pensions instead of 5% proposed by the government.

b) The abolition of early retirement from July 1 instead of October as proposed by the government.

c) Lifting the retirement age to 67 years for everyone except those who are involved in “heavy” professions or for parents of children with disabilities.

d) Measures to cover the cost of legal decisions that have rendered previous pension reductions void.

e) Employer and employee contribution reductions instead of an increase that the government has proposed.