Multiple tax burden hurts Greek firms’ competitiveness
Greek enterprises are burdened by an exceptionally noncompetitive tax system and the results of this are reflected in the country’s economy, according to the monthly bulletin published by the Hellenic Federation of Enterprises (SEV). Consequently Greece imposes the second highest tax on corporate earnings and dividends among European Union member-states, while senior officials at Greek companies are taxed at a level that is similar to their counterparts in France, Belgium and Italy and higher than those in the Scandinavian countries, without any respective improvement in the quality of services that those taxes are supposed to pay for. Furthermore, the capacity to offset losses against future earnings is restricted in Greece to five years, while in most other EU states – which haven’t gone through such a long, deep crisis – there is no time limit. Local enterprises are also burdened by various technical details in the country’s tax system. The lack of clarity on subjects such as tax-exempt expenditure generates significant uncertainty for domestic businesses, which often face unexpectedly high tax dues following inspections, while the discounts offered by Greek legislation for expenditure on research and developement are below those of fellow EU countries. SEV also issued a package of proposals to resolve some of the tax system’s problems ahead of the European Commission’s launch of the recalibrated Common Consolidated Corporate Tax Base. This is a single set of rules to calculate the taxable profits of companies in the EU. The Greek firms that enter the CCCTB will – according to SEV – be able to “benefit from the increased clarity over the definition of exempt expenditure, the unlimited time for the offsetting of losses against future profits and the more generous tax discounts for research and development spending.”