The year 2025 marks a new era for the tax map of the country, as a number of significant changes are put in place that substantially enhance the disposable income of citizens. At the same time, the AADE is strengthening the fight against tax evasion through new innovative technologies and tools, focusing on effective detection and combating it.

As APE-MPE reports, the State’s strategy is based on two main axes: tax reduction and income enhancement, with a special focus on the middle class. This social group is constantly affected by inefficiency and high tax burdens.

2025 is expected to be a pivotal year, as it will determine the potential for further permanent tax cuts. The actions taken by the GAO to crack down on tax evasion, combined with revenue enhancement measures, are critical factors in achieving these goals.

Significant tax interventions

The first axis includes a comprehensive package of tax interventions to be implemented from 2025,with a total fiscal cost of €1.5 billion.

According to the Ministry of National Economy and Finance, these interventions are aimed at increasing disposable income, while aligning with the European fiscal framework that restricts spending.

The key tax interventions include:

* Reduction in social security contributions: A one-point reduction will lead to wage increases and a reduction in non-wage costs. From 2019, the total reduction reaches 5.4%, for €440 million per year, benefiting both workers and employers in the public and private sectors.

* Elimination of business tax: The phased abolition that started in 2024 ends in 2025 for self-employed and self-employed persons, for €238 million.

* Exemption of low pensioners from pharmaceutical costs: About 132,000 pensioners will no longer participate in pharmaceutical costs, for €23 million.

* Tax exemptions for specific properties: Properties up to 120 square meters that are leased for a long period will be exempt from income tax for three years, for 3 million euros.

* Health benefits: Exemption from premium tax for health insurance policies for children up to 18 years old, for €17 million.

* Reduction of ENFIA: ENFIA is reduced by 20% for residences of individuals with a taxable value of up to 500,000 euros, for 18 million euros.

* Abolition of fixed telephony fee: The measure concerns high-speed fibre optic connections, at a cost of €24 million.

Income support

The second axis includes seven direct income support measures to strengthen social cohesion and improve citizens’ purchasing power.

These measures include:

* Pension increases: Pensions are increased by 2.4%, at a cost of €398 million. At the same time, the salaries of military school students are also increased.

* Student housing allowance: The allowance for students from regional universities is increased by 500 euros, reaching 2,500 euros in case of cohabitation. The total cost amounts to €15 million.

* Enhancement of allowances: The allowance for night work for uniformed staff is increased, at a cost of €25 million.

* Minimum wage: The minimum wage will be further increased in 2025, while civil servants’ salaries will be adjusted accordingly.

* Armed Forces Allowances: The special circumstances allowance is increased by €100 per month, at a cost of €111 million in 2025.

With the above interventions, the government seeks to improve the living standards of citizens, strengthen the middle class, and create a sustainable and fair economic environment. The year 2025 is expected to be decisive for the formation of a new economic model, which will combine growth and social justice.

Limiting tax evasion

Combating tax evasion remains a key priority for the government and the Ministry of National Economy and Finance, with an emphasis on reducing the VAT gap. According to Minister Kostis Hatzidakis, the 11 initiatives implemented in 2023 led to an 11.2% increase in VAT revenue in the first 9 months of 2024.

With the completion of the interconnection of POS with cash registers and the implementation of the myData system, additional VAT revenues of around €1.8 billion are expected in 2024.

In 2025, the AADE will strengthen its efforts to combat tax evasion by using new digital tools. The myData system will be expanded for income and expenditure declarations, while Electronic Invoices, Digital Delivery Notes and Digital Customer Log will be implemented on a mandatory basis.

Finally, the State Budget Office in Parliament estimates that the target for collecting an additional 2.5 billion euros from tax evasion from 2025 onwards is realistic. It is estimated that an overrun of VAT revenues by EUR 2 billion is possible already in 2024. The additional revenues, in the opinion of the relevant bodies, should be directed mainly to reducing direct taxes, as this would act as an incentive to boost employment.