The countdown is on for the finalization of the tax relief package and interventions regarding housing issues that Prime Minister Kyriakos Mitsotakis will announce in early September at Thessaloniki International Fair (TIF).

Within the next 20 days, the government will make decisions on relief measures for the middle class and lower incomes, support for financially vulnerable groups, and housing policy measures.

These are key economic policy measures that will be incorporated into the 2026 budget draft, to be submitted to Parliament on October 6, as well as into the new Medium-Term Structural Plan 2026-2029, which the government will submit to Brussels.

Strong growth of the Greek economy, increased revenues due to anti-tax evasion measures, and the defense spending escape clause have “locked in” fiscal space of €1.5 billion for 2026, which will be used to cover the cost of the TIF package. According to information, this will include tax rate reductions focused on middle-income brackets, interventions to support families with children, and addressing the housing crisis.

Among the measures under consideration is a reduction in the tax rate on rental income, along with incentives for property owners to make vacant homes available to the market, which currently exacerbate the housing problem.

The new Medium-Term Structural Plan 2026-2029 will set the ceilings for public spending over the coming years. This concerns the annual increase of net primary expenditures, already set at 3.6% for 2026, 3.1% for 2027, and 3% for 2028. During consultations with Brussels, the corresponding growth rate for 2029 is expected to be finalized. The new Medium-Term Plan will foresee that Greece will maintain high growth rates in the coming years, significantly above the eurozone average. It is recalled that this year the Greek economy’s growth rate is estimated at 2.3%. Additionally, it will be foreseen that Greece will continue on a path to achieving high primary surpluses in the coming years. It is noted that this year the primary budget surplus is expected to exceed the initial target of 2.4% of GDP, with estimates raising it to about 3.5%. This is a significant overshoot of the target for the second consecutive year, as in 2024 it soared to 4.8% of GDP.

The forecasts for growth, primary surpluses, and debt will be Greece’s strong “cards” in the coming years throughout the period of the new revised Medium-Term Structural Plan. Regarding growth, it is expected that the positive impact of the Recovery Fund projects will continue, a momentum that is also anticipated to benefit from the positive effects of three new European environmental funds totaling €8 billion to which Greece has been included, as well as an increase in the national component of the Public Investment Program. The projection for maintaining high primary surpluses is based both on growth dynamics and on permanent budget revenues from tax evasion control measures. For public debt, further de-escalation is expected, aiming for Greece not to be the EU country with the highest debt-to-GDP ratio by 2028.