ATHENS – Property owners angry over a new “emergency” tax being put into their electric bills under the threat of having their power shut off for non-payment will find their bills since three years ago will be six times higher, a group representing them has warned. The Hellenic Property Federation (POMIDA) said that the recently passed emergency property tax, which will be levied through electricity bills from this month along with an adjustment in the real estate values applied by tax offices will lead to a 600 percent hike in 2012 compared to 2010.
Desperate, Greece has hit workers, pensioners and the poor with a slew of new taxes, but the new property tax has been deemed the most onerous by property owners, who comprise as much as 80 percent of the population. Critics said that tax evaders, including many rich land owners the government said hide their assets, will also escape the new property tax while the burden will fall on workers and the middle class, although many foreigners who own property in Greece will also feel the hit.
Property tax raised $670 million in 2010. This figure is projected to rise to $1.47 billlion this year while for 2012 budget, the government hopes to raise $5 billion from real estate levies, but strong resistance is building among some who want to extend a “We Won’t Pay” movement to refusal to pay the new tax. Prime Minister George Papandreou and Finance Minister Evangelos Venizelos have appealed to Greeks to pay the tax but so far have done little to go after tax evaders costing the country nearly $40 billion a year in lost revenues, according to international lenders loaning the country $152 billion to stave off a bankruptcy many analysts said is inevitable.
The Economist magazine said that “If property-owners fail to come up with at least €1.7 billion ($2.3 billion) in extra tax revenues by the end of the year, the budget deficit will rise above the new limit of 8.5% of GDP- already worse than the target set in last year’s bail-out agreement – and derail next year’s projections,” and added that: “A large chunk of earnings from the grey economy during the boom years of the early 2000s was laundered through the construction of luxurious second homes.”
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