Greece’s new Prime Minister Kyriakos Mitsotakis on Saturday announced immediate tax cuts on single properties and businesses, wage increases and a vote to Diaspora Greeks, among other promises.
“The July 7 elections ended the cycle of crisis,” Mitsotakis said before Parliament, as he presented the policy framework of his new administration.
“The people’s mandate was specific and crystal clear. Greece, with a majority government, can go forward, with hard work. My government and I will absolutely honor this mandate,” he added.
“Our mission is,” Mitsotakis said, “to link wages to growth – so everyone has a share in prosperity.”
The new prime minister also announced opportunities for young people through an education system which will, his administration hopes, stop producing unemployed people. Moreover, he promised regulation in the labor market and the protection of employees as well as a good public health system.
“Meeting the 2019 and 2020 targets, we will move on to our plan,” Mitsotakis noted, adding: “The business tax will be reduced to 20 percent in two phases. In September the tax will be reduced to 24 percent for 2019 incomes and the tax on dividends will be reduced to 5 percent.”
He stressed that there would be an average 22 percent reduction in single property tax (ENFIA) as of August, 2019.
Small property owners will see 30 percent cuts, middle-class owners will see 20 percent cuts and large property owners 10 percent, he explained. This will happen with the first tax bill to be voted on as a part of this emergency procedure. This means that instead of 2020, the ENFIA will be reduced in just a few weeks for 6.4 million property owners.
As regards the 120-installment debt repayment, Mitsotakis said that the government will soon announce improvements to the program.
In particular, the minimum monthly payment will be reduced from 30 euros to 20 euros, the interest rate will be reduced from 5 percent to 3 percent, and the bill will be extended to include all enterprises with a basic debt of up to 1 million euros. Confiscations for those who remain in the debt settlement framework will be suspended.
The prime minister also announced the following:
A 40 percent tax deduction to energy costs for households and functional and aesthetic upgrading of buildings.
● The first tax rate for incomes of up to 10,000 euro will be reduced from 22 percent to 9 percent.
● The solidarity contribution levy will be gradually abolished.
● Social security contributions will be gradually decreasing from 20 percent to 15 percent, and VAT will be reduced from 13 percent to 11 percent and from 24 percent to 22 percent.
The government will do whatever it takes to save the Public Power Corporation, without any new burden on consumers. Where necessary, networks will be privatized and the strategic debtors will suffer the consequences of the law, he said, adding that “once the company is reorganized, a strategic investor will be sought.”
Moreover, Mitsotakis said that 30 percent of Athens’ Eleftherios Venizelos Airport will be sold and Hellenic Petroleum will be privatized.
He also promised to make the best use of state property. The investment in former Elliniko airport will immediately start and will become the symbol of the new Greece, Mitsotakis underlined.
The new prime minister also announced changes in Greece’s Penal Code to prevent the release of criminals and terrorists.
According to Mitsotakis’ announcements, the budget for 2020 will not affect the fiscal balance or challenge the goals of the previous government’s primary surpluses. However, after achieving the targets, he said, the government will be able to claim the reduction of surpluses in the next year.
Mitsotakis to give Diaspora Greeks the right to vote
Apart from the economic issues, Mitsotakis pledged that he will give Greeks living and working abroad the right to vote.
Mitsotakis also underlined that international law is always the “compass” for relations with Turkey, and he called on the Turkish president to make steps forward.
The prime minister also announced the following measures for the protection of the environment:
– As of 2021, disposable plastics will be banned. Greece needs to protect its beautiful nature in practice.
– Businesses will be motivated to adapt to the cyclical economy by upgrading their equipment and re-training their workers.
– In a specific timetable, small Greek islands will become energy-autonomous through the development of Hybrid Renewable Energy Sources. There is also interest, relevant experience, and European funding available as well as expertise from Greek educational and research institutions.
– A Strategic Plan for Electric Mobility in major cities and islands will be implemented in a four-year time frame.The first objective is the renewal of mass transport by the use of urban electric buses and pilot applications in cooperation with the local government.