Greeks wake up to open banks, higher taxes
Greece set a series of landmarks Monday it hopes will shore up its battered economy following months of crisis that threatened its place in the euro.
Banks reopened after more than three weeks, and the cashstrapped country got a shortterm loan from European creditors to pay more than 6 billion euros owed to the International Monetary Fund and the European Central Bank. Non-payment on either would have derailed Greece’s recent bailout request.
For most recession-weary Greeks, Monday was all about the price of goods in the shops as new tax rises demanded by creditors on everything from coffee to taxis took effect. And though the banks may have opened, strict limits on cash withdrawals remained.
For an economy reeling from the recent uncertainty over the country’s euro future, the continuing controls on capital and the tax rises aren’t going down too well.
Dimitris Chronis, who has been running a small kebab shop in central Athens for 20 years, says the new taxes could push his business over the edge especially when combined with higher business taxes and meat prices.
“I can’t put up my prices because I’ll have no customers at all,” said Chronis, who said sales have slid by around 80 per cent since banking restrictions were imposed June 29. “We used to deliver to offices nearby but most of them have closed. People would order a lot and buy food for their colleagues on special occasions. That era is over.”
There are few parts of the Greek economy left untouched by the increase in sales taxes on many basic goods from 13 per cent to 23 per cent on many basic goods, from cooking oils to condoms, through to popular services, such as eating out at restaurants and ferries to the Greek islands.
The tax hikes were a key plank of last week’s bailout agreement between Greek Prime Minister Alexis Tsipras and European creditors.
A man leaves a branch of the National Bank of Greece in Athens Monday.