Greek govt offers Christmas gifts of tax and more tax

Tax shocks for farmers and rent money

The Greek Ministry of Finance is negotiating a December tax plan to be implemented in January. Sources state that in negotiations with the quartet of Greek lenders (EC, ECB, ESM and IMF), the government plans to bring back the non-taxable amount for the self-employed.

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Nonetheless, even if the “wise men come bearing gifts” in 2016, there will still be the kalikantzarakia (naughty elves) to wreak havoc.

1. An increase to the tax index for rent. An extra 142 mln euros will be yielded from rent within December. The index that temporarily was withdrawn saw an increase of contributions up from 11%-15% to annual income from rent of less than 12,000 euros and from 33-35% for rent money of more than 12,000 euros for 2015.

2. A gradual increase in tax for farmers. Tax contributions will be increased by 13% this year, 20% in 2016 and 26% in 2017. The government has promised to find equivalent measures so as to avoid or at least lighten the measure but it still remains to be seen as to who will bear the brunt.

3. Legislation concerning an amnesty for declaration regarding black money will be presented in Greek Parliament over the coming week. Retroactive declarations with taxes ranging from 40 to 45% as well as sectional taxes of up to 80% for those who repatriate or place their money in Greek bonds, real estate and other investments.

4. In December, citizens will be called to make assets declarations using TAXIS following their tax declarations.

5. Online connection to the General Secretariat of Information Systems KEPYO registers. The process will be announced in December whereas the pilot program is to begin on January 1, 2016.

6. Incentives for the use of plastic money. From January 1, 2016, expenditure of electronic transactions will be the only one used to register the non-taxable amount.

After the holiday season

1. February will bring interventions and changes to tax amounts for physical and legal persons. The non-taxable limits for the self-employed will be decided on. Tax index changes and the incorporation of a special solidarity contribution with the highest contribution rate expected to be more than 50%.

2. New taxes for real estate to replace the joint single property tax ENFIA aimed at gathering 2.65 bln euros for 2016 whether this is calculated using the new more realistic objective values or not.

3. Law for the new make-up of the General Secretariat of Public Funds.

4. Digital taxation for the increase of electronic transactions so that taxes will be shut to the public and citizens will be served via a telephone center, the internet and their accountants.

5. Measures for smuggling tobacco and fuel.

6. Creation of consultants for tax policies.