Our country recorded an improvement of three places compared to last year’s International Tax Competitiveness Index: the Index is published by the Center for Liberal Studies (KEFIM) in collaboration with the Tax Foundation.

In detail, according to the relevant KEFIM press release, Greece occupies the 23rd place among the 38 OECD countries in this year’s Index. In particular, it gathers a total score of 67/100 in the Index (against 62.9 last year). Regarding the individual categories of the Index, Greece ranks:

• in 16th place in corporate taxation,

• in 4th place in the taxation of natural persons,

• in 30th place in consumption taxation,

• 29th in property taxes,

• and in 23rd place in terms of taxation of profits abroad.

The authors of this year’s Index highlight the following weaknesses of the Greek tax system:

• Companies in Greece face strict limitations on the amounts of net operating losses with which they can offset future profits. They also cannot use losses to reduce previous taxable income.

• Greece has a relatively limited rate of tax treaties (58 treaties against the OECD average of 76).

• Greece has one of the highest VAT rates in the OECD (24%) with one of the narrowest tax bases, covering around 43% of final consumption.

Among the positive points of the Greek tax system highlighted in the survey are the following:

• The net personal tax rate on dividends, at 5%, is significantly below the OECD average (24.7%), while capital gains from listed shares without substantial participation are exempt from taxation.

• The corporate income tax rate of 22% is lower than the OECD average (24.2%).

• Controlled Foreign Company regulations in Greece are moderate and only apply to passive income.

For the twelfth consecutive year, Estonia emerged as the country with the most competitive tax code, while the last place (38th) was occupied by France. Greece is ranked this year between Japan (22nd) and Finland (24th).

The president of KEFIM, Nikos Rompapas, said on the matter: “The significant rise of our country by 3 places demonstrates that targeted, feasible changes to the tax system can significantly strengthen the country’s competitiveness. In addition to further de-escalation of the tax burden, interventions in areas such as international tax treaties and the depreciation system can further improve Greece’s tax profile without negatively affecting tax revenues.”

While the editor of the Index and the Tax Foundation’s principal international policy analyst, Alex Mengden, pointed out: “Ill-structured tax systems are costly, distort economic decisions and harm the economy. Many countries have identified this problem and have moved to reform their tax codes. But recent changes in tax policy among OECD countries have not all led to improvements in the structure of tax systems; some have had negative effects.”