trending Market Intelligence /marketintelligence/en/news-insights/trending/W10lkKzQ2lleK4f3g_3N0w2 content esgSubNav
In This List

Report: Greece's new premier vows to cut taxes, push reforms to spur growth

Podcast

Street Talk Episode 87

Blog

A New Dawn for European Bank M&A Top 5 Trends

Blog

Insight Weekly: US banks' loan growth; record share buybacks; utility M&A outlook

Blog

Banking Essentials Newsletter 2021: December Edition


Report: Greece's new premier vows to cut taxes, push reforms to spur growth

Greek Prime Minister Kyriakos Mitsotakis said his government will cut taxes and put the country back on the growth path a year after exiting its third international bailout program in a decade, Reuters reported.

Speaking Sept. 7 at the opening of the annual Thessaloniki International Fair, where Greek leaders traditionally lay out their economic agenda, Mitsotakis revealed his plan to cut corporate tax to 24% in 2020 from 28% currently, and to lower dividend taxes to 5% from the current 10%.

Mitsotakis also promised to reduce the tax bracket to 9% from 22% for annual incomes of up to €10,000, provide Greek pensioners with an annual bonus by the end of 2020, and lessen the yearly levy imposed on self-employed individuals.

In order to boost Greece's vital real estate sector, Mitsotakis committed to scrap value-added tax on new construction for the next three years, as well as capital gains tax on property sales.

The tax cuts are being proposed against a backdrop of continuous fiscal monitoring by Greece's European creditors, who have required the heavily indebted country to achieve a primary budget surplus of 3.5% of GDP in 2019 and 2020.

Athens, however, is banking on reforms aimed at cutting red tape and making government more efficient to convince foreign lenders to lower the primary budget surplus requirement to 2% of GDP by 2021. This is expected to give the Greek government more space for tax cuts and greater public spending to spur economic growth after a decade-long debt crisis, Reuters reported.

The conservative Mitsotakis replaced leftist predecessor Alexis Tsipras in elections in July, promising to revitalize the Greek economy. DBRS said in May that it expected Greece to "remain on a sustained growth path" after registering real GDP growth of 1.9% in 2018.