Executives of the economic staff talk about a great opportunity that the country has in front of it
Three-year open corridor leading to ejection of investments at record levels for the Greek economy and the government’s economic staff sees further tax cuts focused on the middle class.
The particularly favorable situation created for the country by the mammoth investment program financed by the Recovery Fund and the NSRF and by the significant increase in revenues due to the measures to reduce tax evasion, creates the conditions to cover the country’s investment gap at a faster pace and reduce the burden on taxpayers according to financial staff members. They talk about a great opportunity that the country has in front of it in order to consolidate the rates of growth in the coming years and to restore injustices in the tax policy that have their roots in the era of the memorandums.
Based on these new data, the two major priorities set for economic policy are:
a) The rapid absorption of the resources of the Recovery Fund and the financing of European programs through the NSRF alongside the rapid notarization of the projects in order to yield the fastest in the development of the economy and
b) The continuation of the policy of limiting tax evasion with measures such as the digitization of transactions and controls of the Independent Public Revenue Authority (AADE).
Public Investments
The Public Investment Program which the country is called to “run” within the next three years is the largest that has ever existed in history and this is also a great challenge. For 2024 it amounts to 13.15 billion euros, for 2005 14.1 billion euros and for 2026 it is expected to be around 15 billion euros. Overall, this is a mammoth Public Investment Program as it will exceed €42 billion by the end of 2026. This includes Recovery Fund funds and Community resources through the NSRF, alongside domestic government funding. They are intended for projects in all sectors of the economy, from construction, infrastructure and energy to health, education and digital development in critical sectors. To the amount of more than 42 billion euros should be added the loans that will be made available by the Recovery Fund through the banks to companies for their investment programs, which for 2024 are estimated at 5.3 billion euros and at 5.455 billion euros for 2025.
Tax evasion
On the tax evasion front, the digitization of transactions and the measures taken by the Ministry of Finance, including the presumptive taxation of professionals, generated an additional revenue of 1.8 billion euros in 2024. The ministry estimates that this increase will continue in the coming years, on the one hand because the existing measures will pay off, on the other hand because they will be enriched with new interventions in the field of digital transactions and with the digital upgrade of tax audits, as can be seen from a recent presentation of the new digital tools of AADE. It is indicative that in 2024 VAT revenues exceeded 1 billion euros, a development that is largely attributed to anti-tax evasion measures. The goal set by the Ministry of Finance is the policy of limiting the taxable material that escapes yielding additional revenue of 2.5 billion. euros annually until 2027. These data pave the way for new tax reductions, which will focus on the relief of the middle class, as Prime Minister Kyriakos Mitsotakis announced from the stage of the AADE event on Thursday. The government’s plans include lowering tax rates for middle-income earners as well as reducing living standards to address injustices and distortions that exist today.
