Gov’t re­drafts coun­ter­mea­sures

Cuts in cor­po­rate tax said to be part of new pro­posal as lenders push for growth-boost­ing re­forms

Kathimerini English - - Front Page -

Govern­mentof­fi­cials spent the week­end re­draft­ing a pro­posed pack­age of so-called coun­ter­mea­sures aimed at off­set­ting fresh aus­ter­ity in­clud­ing calls for the re­duc­tion of cor­po­rate tax to 26 or 27 per­cent from the cur­rent rate of 29 per­cent.

Ac­cord­ing to sources, the orig­i­nal pack­age pre­sented to cred­i­tors fo­cused on re­duc­ing value-added tax and a uni­fied prop­erty levy and cut­ting so­cial se­cu­rity con­tri­bu­tions for small and medium-sized busi­nesses but did not in­clude the pro­posal for cor­po­ra­tions. Lenders re­jected the gov­ern­ment’s ini­tial ideas, in­sist­ing in­stead on a pack­age that in­cludes growth-boost­ing mea­sures.

Greek of­fi­cials and rep­re­sen­ta­tives of the coun­try’s in­ter­na­tional cred­i­tors have sought to ap­pear up­beat about the prospect for con­clud­ing the cur­rent bailout re­view in their pub­lic state­ments. But, ac­cord­ing to sources, the con­clu­sion of the re­view is more likely at a Eurogroup sum­mit sched­uled to take place on April 7 than a meet­ing on March 20. The orig­i­nal tar­get had been a Fe­bru­ary 20 Eurogroup where it was de­cided that stalled bailout talks would re­sume.

Ini­tial eu­pho­ria over the re­sump­tion of ne­go­ti­a­tions soon gave way to ten­sions af­ter it be­came clear that there was lit­tle con­ver­gence be­tween the two sides on ma­jor is­sues as well as tech­ni­cal de­tails.

Gov­ern­ment sources said they be­lieved bailout mon­i­tors dis­agree among them­selves about cer­tain mat­ters. There is also a sense, the same sources said, that the au­di­tors might be drag­ging their feet on pur­pose to al­low the chiefs of the cred­i­tor in­sti­tu­tions to reach an agree­ment re­gard­ing Greek debt re­lief.

It ap­pears that Ger­man Chan­cel­lor An­gela Merkel and In­ter­na­tional Mon­e­tary Fund chief Chris­tine Lagarde have reached an un­of­fi­cial agree­ment: that Lagarde will con­sent to the IMF back­ing Greece’s third bailout while Merkel ac­cepts the Fund’s de­mand for the flesh­ing out of mea­sures to re­lieve Greek debt, de­spite the ob­jec­tions of her Fi­nance Min­is­ter Wolf­gang Schaeu­ble.

The ad­di­tional de­tail on debt re­lief is a pre­req­ui­site for Greece’s in­duc­tion into the Euro­pean Cen­tral Bank’s quan­ti­ta­tive eas­ing scheme. Athens is hop­ing that the bailout re­view will have been wrapped up well be­fore the ECB man­ag­ing board’s sched­uled meet­ing on April 27.

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