Strong support to the state budget they are expected to give the increased tax revenues which will come without the imposition of additional taxes but will be based on two specific parameters. The first has to do with limiting tax evasion, for which it is estimated that the POS and cash register interfaceas well as the higher income tax revenues, which will be brought about by the increases in the income of civil servants, the increase in the minimum wage as well as the new system of calculating the income for the self-employed.

Also, an additional element is the contribution to the increase in public revenues, from the additional growth of the economy, which, although it will be marginally lower due to inflation, will nevertheless run at rates higher than those of the Eurozone.

This trend is also confirmed by the data released a few days ago by the Ministry of National Economy and Finance for the execution of the budget in the first 3 months of the year, as it is clearly seen that the only source that outperforms is that of income tax, with the lion’s share coming from business.

Also important is the fact that VAT revenues remain in positive territory, despite having created a high base last year, which is attributed on the one hand to the development of the economy and on the other hand to the extensive use of plastic money.

According to what is provided by Alpha Bank in the Economic Developments Bulletin, “2024 is expected to continue the upward trend of government revenues in Greece, with an estimated amount of 63 billion euros. The main driver of this increase is expected to be taxes on goods and services, as well as income taxes».

In particular, Alpha Bank mentions the strengthening of incomes, through which the additional income tax will be an indirect benefit for the budget.

In particular, it is emphasized that “in the context of the 2024 budget, interventions are foreseen with the aim of strengthening citizens’ incomes. These include a new increased maximum net pay, a pay rise for civil servants and the lifting of the pay freeze for private sector workers. In addition, an increase in the tax-free allowance for families with children and increases in pensions are foreseen.

Particular emphasis is placed on limiting tax evasion through interventions to further strengthen electronic transactions and improve the transparency and effectiveness of controls. As noted by the Economic Bulletin “this includes the interconnection of cash registers and point of sale terminals with the tax authorities and the limitation of the use of cash in real estate transactions. It is also important that the informal economy in Greece has significantly decreased, which strengthens the country’s economic stability and fiscal credibility.”

The positive developments regarding the primary surplus of 2023, which stood at 1.9% of GDP, exceeding the estimates of the Budget which spoke of a surplus of 1.1% of GDP, is considered particularly important. According to analysts, this is mainly due to the increase in tax revenues, which came from the upward trend in matters of private consumption, employment, incomes and the price level. Also, the increase in electronic transactions contributed to the increase in public revenues.

In detail, the increase in government revenues in 2023 is mainly due to the increase in tax revenues, which reached 61.6 billion euros, and especially to direct income taxes.

What the first figures for 2024 show

The trend of increasing tax revenues from all individual categories, but mainly from income tax, is fully confirmed for the 3-month official data.

Revenues from the “Taxes” category amounted to 14.844 billion euros, registering an increase of 598 million euros or 4.2% in relation to the target set in the introductory report of the Budget for 2024. Specifically, for the main taxes of this category we observe the following:

  1. VAT revenue amounted to 5.876 billion euros, showing a reduction of 16 million euros compared to the target.
  2. The revenues of the Special Consumption Taxes (SCT) amounted to 1.532 billion. euros, registering an increase of 5 million euros compared to the target.
  3. Revenue from real estate taxes amounted to €260 million, a €19 million decrease compared to the target
  4. Revenues from income taxes amounted to 5.105 billion. euros, recording an increase of 563 million euros compared to the target. Of this amount, Personal Income Tax increased by 66 million euros and Corporate Income Tax increased by 451 million euros compared to the target.