In a surprise move, main opposition New Democracy leader has announced that when Parliament re-opens after the Easter break he will table a bill to block the lowering of the tax-free threshold, which the government passed into law in June, 2017, and which is due to take effect on 1 January, 2020.
“I challenge Mr. Tsipras to come along and support the draft legislation which I will table [in Parliament],” the opposition leader told ANT1 television.
The IMF and the European Commission have made clear that they expect the government to implement the law.
For its part, the government has said that it has the requisite fiscal space to rescind the law and that it intends to do so, but the Commission views the measure as a structural reform and not as a revenue-raising measure.
The IMF has said that aside from fiscal considerations the lowering of the tax-free threshold must go forward in other to allow the lowering of the very high taxes on labour and businesses.
The IMF believes that the two billion euros in revenues that the measure will bring to the state coffers should be used to reduce the personal income tax rate which is currently 45 percent for an annual income of over 40,000 euros.
ND won’t cut private sector holiday bonuses
Mitsotakis made clear that he does not intend to abolish holiday bonuses – which have already been eliminated in the public sector – in the private sector as many believed he intimated in remarks during a recent trip to Cyprus, where he said young people should not expect a Christmas bonus.
For decades before the crisis both private and public sector employees each year received a Christmas bonus of one month’s salary and half a month’s salary at Easter and before their summer vacation. The bonuses were essentially factored into the salary.
“Frankly, I don’t want a society which is dependent on Christmas handouts. Young Greeks should not be expecting a Christmas gift at the end of each year in order to become essentially hostages of a clientelistic system – rather than handouts a focus on opportunities,” Mitsotakis had said.
Supporting the long-term unemployed, not handouts
“If we need to do some rebalancing in terms of our social policies, we should focus much more on supporting the long-term unemployed people and offering retraining and re-skilling opportunities rather than having people dependent on a handout which we just don’t know if it’s going to be available forever,” he had added.
He also ruled out the prospect of offering pensioners an extra (13th) pension annually, which the government suggested it will do if it has the necessary fiscal space, and underlined that pledging that to retirees would constitute populism.
