High taxes in Greece deter foreign investors while the difficulty in getting bank loans forces Greek companies to relocate to neighboring countries, said President of the Athens Chamber of Commerce and Industry (ACCI) Constantinos Michalos.
Speaking at a meeting of the Technical Chamber, Michalos explained the reasons there is such low investment activity in the past few months. At the same time, he reiterated the fact that many Greek businesses flee to neighboring Bulgaria and Cyprus where business taxation is much lower. Furthermore, the delay of certain economic reforms delay possible investments as well.
Regarding Greek businesses, the ACCI president stressed the capital controls and the reluctance of banks to give loans to existing or new businesses. At the same time, the inefficiency of public administration and bureaucracy create a hostile environment for investors.
“How can I convince an entrepreneur or investor to take initiatives in Greece — even with subsidies — when they are asked to pay 29% corporate tax, 15% dividend tax, 5-10% solidarity contribution, ENFIA tax and excise taxes on energy and in telephony. Why would anyone decide to invest in Greece today and not in a neighboring country, where the total tax costs do not exceed 27%?” Michalos wondered aloud.
“In order to mobilize private funds and investments, we not only need financial incentives. We need a combination of technocratic and political skills. Effective monitoring and evaluation mechanisms are needed. We need a clear policy and complete transparency. Mostly, however, we need coherent economic and fiscal policies. Policies that do not cancel funding opportunities, but instead create the conditions for profit,” the ACCI president said.