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(Jan 31, 2011) On January 25, 2011, the Greek Ministry of Finance submitted to the legislature a new, much-anticipated tax bill, which aims, through the adoption of a number of significant initiatives, to improve and revive the ailing economy, reorganize public services, and impose tougher sanctions against tax evasion. The bill is open for consultation and comments by the public until Monday, January 31, 2010. (Changes to the Tax Bill [in Greek], KATHIMERINI (Jan. 26, 2011), http://www.kathimerini.gr/4dcgi/_w_articles_kathremote_1_26/01/2011_3752
Among the critical new measures designed to attract foreign investment in Greece is the lowering of the corporate tax rate to 20%, from the current 24%. Also, distributed earnings will benefit from a lower withholding tax of 25%, replacing the existing progressive tax rate of up to 40%. In addition, there will be an increase in the tax on gains arising from stock market transactions from the current 0.15% to 0.2%. (Id.)
On tax evasion the draft bill originally envisaged the introduction of an attorney general for financial crimes. A later version of the bill, amended by the Department of Justice, provides for a public prosecutor, rather than an attorney general. The draft bill also provides for a term of imprisonment of up to ten years for outstanding tax debt. For the first time and in an effort to improve transparency, the bill introduces use of electronic receipts for transactions between consumers and companies. (Id.)
Another measure proposed in the bill is the establishment of certain criteria to inspect low reported income. The later version, as drafted by the Minister of Justice, does not target any self-employed persons in particular, nor does it include a threshold for the inspections. It is reported that this measure is designed to combat the perennial problem of such persons under reporting income for tax purposes. These individuals, such as doctors, dentists, lawyers, architects, and certified public accountants, typically have high earnings. (Id.)
|Author:||Theresa Papademetriou More by this author|
|Topic:||Taxation More on this topic|
|Jurisdiction:||Greece More about this jurisdiction|
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Last updated: 01/31/2011