CoS ver­dict up­sets ENFIA plan

Re­vised ob­jec­tive val­ues of prop­er­ties in cer­tain ar­eas to ap­ply retroac­tively from Jan­uary 1, 2017

Kathimerini English - - Focus - BY PROKOPIS HATZINIKOLAOU

The Sin­gle Prop­erty Tax (ENFIA) is to un­dergo sig­nif­i­cant changes from 2017 after the Coun­cil of State ruled that the method used to cal­cu­late the tax for four ar­eas in the coun­try was il­le­gal on the grounds that it did not take into ac­count their spe­cial fea­tures in the as­sess­ment of their ob­jec­tive val­ues (prop­erty rates used for tax pur­poses).

Fi­nance Min­istry of­fi­cials say that the de­ci­sion forces the gov­ern­ment to pro­ceed to a new ad­just­ment of the ob­jec­tive val­ues in the ar­eas of Filothei, Psy­chico, Neos Voutzas and Del­phi by the end of the year, and pos­si­bly in more lo­ca­tions should any sim­i­lar ver­dicts emerge from the CoS. Hun­dreds of ap­peals from around Greece are still pend­ing at the coun­try’s high­est ad­min­is­tra­tive court.

Min­istry of­fi­cials add that fol­low- ing the pub­li­ca­tion of the CoS de­ci­sion, au­thor­i­ties will start re­view­ing the ob­jec­tive val­ues in the above ar­eas alone, while the new rates to be de­ter­mined will only con­cern prop­erty trans­ac­tions to be made in 2017, so that the 2017 ENFIA will also be cal­cu­lated based on the new val­ues.

One Fi­nance Min­istry source notes in par­tic­u­lar that the min­istry’s plan­ning in­cludes the cre­ation of a sys­tem for the au­to­matic ad­just­ment of ob­jec­tive val­ues that will start op­er­at­ing in the sec­ond half of 2017. How­ever, in or­der to take into ac­count the con­se­quences of any new court de­ci­sions, the new ob­jec­tive val­ues to be in­tro­duced based on the mar­ket rates will have a retroac­tive ef­fect, start­ing from Jan­uary 1, 2017. That is be­cause the taxes im­posed on prop­er­ties are based on the ob­jec­tive val­ues ap­ply­ing on Jan­uary 1 each year.

Al­though the plan for an ad­just­ment sys­tem fol­low­ing mar­ket 601.07 1.0717 prices is a step in the right di­rec­tion, prop­erty mar­ket pro­fes­sion­als note the dif­fi­culty in deter­min­ing the ac­tual go­ing rates across the coun­try, as the cri­sis has min­i­mized trans­ac­tions and the few that do take place are not enough to de­duce safe con­clu­sions.

No­tary firms stress that any trans­ac­tions that do oc­cur nowa­days are due to the need for cash, which means prop­er­ties are of­ten sold for far less than they are worth.

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