By Chrysostomos Tsoufis

Without much surprise, the Prime Minister presented yesterday from the stage of the TIF a network of interventions that, as we wrote in skai.gr, have to do with the permanent stimulation of disposable income, housing, demographics and the increase in production .

If something was missing, in the first reading, it was the much-desired reduction of the solidarity contribution of pensioners and measures to limit the prices of mainly products and services.

Freelancers must also feel disappointed who – even if the government had said it would make small changes to their presumptive taxation – probably expected something more.

INCOME STIMULATION

With the measures to stimulate incomes, the prime minister tried to achieve 2 goals. On the one hand, to convince that indeed the high growth rates (our country had the highest rate in the Eurozone comparing the second quarter of this year with the first quarter) translate into an improvement in citizens’ earnings, on the other hand, that the goal of increasing the average salary in the private sector at €1500 at the end of the second four-year government is feasible.

For 2025:

  • Insurance contributions are reduced by 1 unit. By 2027, Greece will have reduced non-salary burdens by 6 units
  • 2 million pensioners will see pension rises of 2.2% to 2.5%
  • The minimum wage will rise again
  • 700,000 civil servants will see increases of up to €100/month in the Spring
  • The application fee is abolished with a benefit of €325/year for sole proprietorships and the self-employed
  • The minimum presumptive taxable amount of freelancers will be halved in areas with up to 1,500 inhabitants instead of 500 as was the case this year. In addition, the criterion of the maximum salary of an employee will not be calculated additively but only comparatively
  • The on-call services of the NHS doctors will be taxed independently at a rate of 22%, which will lead to an average salary increase of €130/month
  • The remote area allowance for doctors is increased sixfold to €600/month
  • 20% increase in night allowance for crews (Armed Forces, Police, Fire, Coast Guard)
  • The fixed telephony tax of 5% is abolished for optical fiber connections with a speed of more than 100Mbps

At the end of this year one will be given again solidarity allowance from resources that have already arisen from the extraordinary taxation on refineries and possibly “profit” from a larger primary surplus that will result from the execution of the budget:

  • 670,000 pensioners with a personal difference and income up to €1600 will receive €100-€150-€200 depending on the amount of their pensions (main and supplementary)
  • 767,000 child benefit recipients will get an extra payment
  • 220,000 beneficiaries of OPECA and EFKA disability allowances and 35,000 uninsured seniors will receive €200
  • 205,000 beneficiaries of the Minimum Guaranteed Income will receive it increased by 50%

DEMOGRAPHIC

This is where the government comes with a measure of surprise to exempt businesses that will support their staff members who become parents with benefits of up to €5,000, from the tax on these amounts.

As expected, the rights of those with three children are converging with those of those with many children, such as appointment to the State, admission to HEIs and participation in social tourism programs.

Allowances for new parents are increased by €20m and the 15% tax on health insurance for children up to 15 years old is abolished.

The Ministry of Social Cohesion and Family will announce additional measures within days, while the same Ministry has undertaken the reform of Housing, Child and Minimum Guaranteed Income benefits. And they will increase but they will also become more targeted so that they reach those who really need them.

Changes are also expected to be made to the unemployment benefit. On the one hand, it will be front-loaded, that is, the beneficiary will initially receive a larger part of it so that the shock of the change in his lifestyle from the loss of his job can be more adequately dealt with, and every quarter it will be reduced. In addition, its amount will be linked to the salaries and insurance years of the employees.

HOUSING

The negotiations with the Commission were successful and thus the MY HOME 2 Program is a fact. With resources of €2 billion, at least 15,000 young people or young couples up to the age of 50 will be able to acquire their first home. The interest rate will be half of the commercial rate. RENOVATE-RENT and the SOCIAL GENERATION program will proceed normally.

But the prime minister also announced a new program of €400 million for loans of up to €20,000 at zero interest with the aim of energy upgrading thousands of old houses

At the same time, there will be a three-year exemption from the rent tax that will be collected by those owners who will open their properties up to now for long-term lease. The tax exemption also applies to those who will withdraw their properties from short-term rental and direct them to long-term rental.
New short-term leases fee in the 3 central apartments of Athens for at least one year, while contracts through platforms will be subject to a new, increased fee.

The motivation for insuring homes worth up to €500,000 against natural disasters increases with the doubling of the ENFIA discount to 20%. The reduction remains at 10% for houses of greater value whose owners, if they do not take out their insurance, from April 2025 will not be compensated by the state in the event of disasters.

In addition, the scope of compulsory business insurance is also expanded, since the turnover limit drops from €2 million to €500,000. Otherwise, they are excluded from compensation, as will uninsured vehicles for private or professional use.

FARMERS

The Prime Minister focused on 3 initiatives:

– The permanence of the abolition of the tax on agricultural oil
– A new management system for red loans and individual farmers as well as cooperatives. It will be possible to reduce the interest and even cut the outstanding capital. Over time, repayment will be made with the possibility of refinancing and final settlement and elimination of encumbrances.
– The preparation of a €600m program for the increase of crops in greenhouses.

After housing, there will also be a consideration plan for idle public land to investors who will build and grow greenhouses with an emphasis on exportable products.

INCREASE PRODUCTIVITY

In the last part of his announcements, Kyriakos Mitsotakis emphasized measures that will increase productivity and stimulate the country’s development such as:

– The establishment of a National Investment Fund with an initial capital of €300m

– The granting of a Golden Visa to those who invest at least €250,000 in the financing of start-up companies.

– The preparation of a study to identify and abolish the 15 most time-consuming bureaucratic procedures with the aim of reducing administrative burdens by 25% with an emphasis on export businesses.

– Especially for tourism, the imposition of a cruise fee per passenger is foreseen, higher in Mykonos and Santorini and lower in the rest of the islands with escalation per season.

-The Climate Crisis Resilience Fee also increases from April to October, proportionally, for hotels, accommodation and rental properties through platforms. The specific revenue will go back to the local communities to better organize their infrastructure against the burden they receive every summer.

The measures will be specified on Monday in a large press conference of the leadership of the Ministry of Finance