Greece will make concessions in order to reach an intermediate deal that would increase liquidity now, and then come up with a comprehensive list of reforms for a final deal in June, Finance Minister Yanis Varoufakis said.
“We are putting the ENFIA (property tax) aside for a while for the benefit of the negotiations,” said Varoufakis on Greek radio on Thursday. One of SYRIZA’s pledges before the elections was to abolish ENFIA. Since the new government has not found a tax to replace it, it is forced to keep it for 2015. However, he added, ENFIA will be abolished as soon as a deal is reached.
“There are two deals: An intermediate one now, in order to increase liquidity, and then we’re going for tough negotiations for a final agreement,” he said. “We don’t expect our program to be accepted immediately,” he said.
According to the new measures on the list, on islands with a population over 3,000, all transactions over 70 euros will be done by credit or debit card in order to tackle tax evasion. There will be no value added tax raises for tourist islands, as was suggested in the past, but the finance ministry is thinking of adding a luxury tax on stay in hotels that are three stars and over.
He said that it was scandalous that islands such as Mykonos and Santorini had record tourist arrivals last year but state revenues from VAT were very low. This is the reason the ministry wants to implement a measure that would require that on tourist islands transactions over 70 euros can be paid with plastic money only.
Varoufakis accused lenders for pushing the Greek government to the limits. He said that it is inhuman to ask for pension cuts when pensions are already low. However, Athens is not going to cross the red lines it has set on such sensitive issues.
He also said that 2015 will close with Greece showing growth figures of 1-1.5 percent and can easily achieve a 1.2 percent primary surplus.
Finally, when asked about the change in the negotiating team, Varoufakis said: “There was an agreement between the prime minister, the government vice-president, my colleagues and the rest of the cabinet to change the negotiating team.” He added that this team has been working together since the beginning of the negotiations and now has an official title.