Tax ex­emp­tions to be slashed

Dis­counts ad­ding up to at least 180 mln eu­ros ex­pected to go in Sun­day’s con­fer­ence call with the cred­i­tors


Tax ex­emp­tion cuts amount­ing to 180 mil­lion eu­ros per year are ex­pected to be con­firmed by the gov­ern­ment and the cred­i­tors in a con­fer­ence call to take place to­mor­row. How­ever, so­cial ben­e­fits are not ex­pected to be af­fected.

Sources say that the tax ex­emp­tions likely to be re­duced are the heat­ing oil al­lowance, med­i­cal ex­penses, the spe­cial tax sta­tus of sea­far­ers and 1.5 per­cent dis­count on the tax with­held ev­ery month from salaried ser­vices.

The sum of the above ex­emp­tions is es­ti­mated at 385 mil­lion eu­ros per an­num, but af­ter the cuts are im­posed they will add up to only 205 mil­lion eu­ros in 2018. The re­duc­tion of the above tax ex­emp­tions is also in­cluded in the re­vised bailout agree­ment, along with oth- er ex­emp­tions that have not yet been de­ter­mined, al­though this may hap­pen to­mor­row.

Fi­nance Min­istry data show that 1.9 mil­lion tax­pay­ers use the tax dis­count stem­ming from health­care ex­pen­di­ture (which is de­ducted from their tax­able in­come), en­tail­ing an an­nual cost of 120.6 mil­lion eu­ros for the state. This will not be abol­ished, but part of it will en­ter the new sys­tem of elec­tronic trans­ac­tions, so that only card pay- ments to doc­tors etc are rec­og­nized as de­ductible.

The spe­cial tax sta­tus of sea­men, which cur­rently costs the state a yearly 91.2 mil­lion eu­ros, will ei­ther be di­luted or abol­ished al­to­gether. The heat­ing oil ben­e­fit has al­ready been cut from last win­ter to 50 per­cent of the 2014-15 sea­son, or 105 mil­lion eu­ros, and is ex­pected to be re­duced fur­ther. As for the dis­count on the tax with­held from 2.9 mil­lion salary work­ers, it sets 623.35 1.0592 the state back 67.9 mil­lion eu­ros a year and is likely to be abol­ished.

In to­tal, the sum of the tax ex­emp­tions granted to tax­pay­ers and cor­po­ra­tions ev­ery year amounts to 3.5 bil­lion eu­ros, ac­cord­ing to the de­tails the Fi­nance Min­istry sub­mits to Par­lia­ment. The tax ex­emp­tions given to house­holds amount to 388.7 mil­lion eu­ros per an­num, while those granted to cor­po­ra­tions reach up to 700 mil­lion eu­ros.

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