This is an increase in the income of citizens by 1.5 billion. euro
“Important initiatives to increase citizens’ disposable income and reductions in taxes and other burdens, amounting to 1.5 billion. euros, will be implemented in 2025”, as noted in a related announcement Ministry of National Economy and Finance. At the same time, it states that “the strengthening of the disposable income of workers and pensioners and the further reductions of taxes are based on the stronger economic growth of recent years and on the successes on the front of limiting tax evasion following the general European fiscal framework that sets specific annual limits for increases expenses”.
In detail, 18 reductions are applied in 2025 wearer and burdens and 7 income support measures that enhance citizens’ income in a permanent and socially fair manner. These reductions come as a continuation of the important interventions implemented by the Government since 2019, abolishing or reducing a total of more than 70 taxes.
Specifically this year:
1) Insurance contributions are reduced by 1 additional unit, which leads to increases in wages and a reduction in non-wage costs. The cost amounts to 440 million. euro. Their cumulative reduction since 2019 amounts to 5.4 percentage points (from 40.56% to 35.16%). This additional reduction benefits both employers (through the further reduction of non-salary costs) and private and public sector workers through the increase in their net wages.
2) The pretense fee is abolished for all natural persons (freelancers, self-employed as well as workers who are paid with a “block”) following the reduction by 50% in 2024, at a cost of 113 million. euros for 2024 and 238 million euros for 2025.
3) An additional 132,000 low-income pensioners who meet the same income criteria as former EKAS beneficiaries are exempted from participating in the pharmaceutical expenditure. The cost is estimated at 23 million. euro.
4) They are exempt from income tax for 3 years for properties up to 120 m2 that will be rented until December 31, 2025 with contracts of at least three years and which were previously declared as vacant or allocated for short-term lease, at a cost of 3 million. euros for 2025 and 13 million euros for 2026.
5) Health policies for children up to 18 years of age are exempt from the premium tax (15%). In the case of a family or group contract, the tax is reduced in proportion to the number of minor members it covers. The cost is estimated at 17 million. euro.
6) Double reduction of ENFIA (from 10% to 20%) for residences of natural persons, with a taxable value of up to 500,000 euros, which are insured for natural disasters (fire, earthquake, flood). The cost is estimated at 18 million. euro.
7) The fixed telephony fee (5%) for optical fiber connections (≥100 Mbps) is abolished, at a cost of 24 million. euro.
8) Tax exemption of voluntary business benefits for new parents (for an allowance of up to 5,000 euros for each child increased by 5,000 euros for each additional child and for a provision of up to 5,000 euros per year to cover the cost of nurseries and kindergartens), at a cost of 6 million. euro.
9) Taxation of fees for on-call doctors at a rate of 22%. The average monthly net benefit for doctors is estimated at 150 euros and in many cases exceeds 200 euros. The cost is estimated at 40 million. euro.
10) Providing incentives for mergers and acquisitions of companies related to “small” entrepreneurship, with a total cost of 41 million. euro.
11) Stamp duties are reduced on a number of transactions with a total fiscal cost of 32 million. euro.
12) The return of the tax on agricultural oil is fixed with a new system based on actual consumption, a measure of total fiscal cost of 100 million. euros per year.
13) New buildings are exempt from VAT for 2025 as well, at a cost of 18 million. euro.
14) The imposition of capital gains tax on the transfer of real estate is suspended.
15) The minimum amount of net income from the exercise of business activity for freelancers in municipal communities with a population of less than 1,500 inhabitants is reduced by 50%.
16) Discounts of 2% – 4% are provided for paying the full amount of income tax by July 31st (4% discount for anyone who submits a tax return from March 15th to April 30th, 3% from May 1st to June 15th and 2% from June 16 to July 15).
17) Gratuities received by employees in catering, hair salons, distribution services, etc., with effect from November 1, 2024, are tax-free up to the amount of 300 euros per month and are not subject to insurance contributions for the entire amount.
18) Limits are applied to bank commissions for daily transactions with implementation within January 2025. Thus there will be a zero charge for payment of bills and debts to the public, insurance funds, OTAs, energy, water supply, telecommunications and insurance companies, via web- banking and mobile-banking. In addition, fees for sending money to another bank are reduced by 50% to 80%, while cash withdrawals in municipal units where there is only one bank’s ATM will have zero fees. At the same time, the 50% reduction in commissions for purchases from 10 euros via POS in the so-called “small retail” is extended to 20 euros, while a zero charge will apply for loading prepaid cards for a loading amount of up to 100 euros.
At the same time, within 2025, 7 measures to boost citizens’ incomes will be activated. Specifically:
1) Pensions are increased by 2.4% based on the rate of change of inflation and GDP, at a cost of 398 million. euro.
2) The salaries of the students of military schools are increased: (a) from 165 euros to 609 euros per month of the salaries of the students of the Higher Military Educational Institutions and (b) from 125 euros to 249 euros per month of the salaries of the students of the Higher Military Schools of NCOs, at a cost of 14 million euro.
3) The student housing allowance for regional Universities is increased by 500 euros (from 1,500 euros to 2,000 euros and to 2,500 euros in case of cohabitation), at a cost of 15 million. euro.
4) The compensation for the night employment of uniformed personnel (Hellenic Police – ELAS, Fire Brigade – PS, Coast Guard – Hellenic Coast Guard – LS-ELAKT, Armed Forces) is increased, at a cost of 25 million. euro.
5) From April, the minimum wage increases further, in addition to its increase of 6.4% (from 780 euros to 830 euros) in April 2024. It is noted that the total increase of the minimum wage from 2021 to 2024 amounted to 27, 7%.
6) In addition, from April, the basic salaries of all civil servants are increasing so that the introductory salary in the State does not fall short of the level of the minimum salary in the private sector, with an estimated cost for 2025 of 143 million. euro. It is noted that 2024 was the first time after 14 years that public sector salaries increased, while the goal is for the minimum and introductory salary in the public sector to reach 950 euros in 2027.
7) From July 1, the officers of the Armed Forces and the Security Forces are further strengthened with the reformation of the allowance for special working conditions to “allowance for special working conditions and dangerousness” and its increase by 100 euros per month, with an estimated total cost of 111 million. euros for 2025 and 222 million euros for 2026. It concerns 153,240 personnel of the Armed Forces, ELAS, the Coast Guard and the Fire Brigade.
