New Greek Dividend Tax May Push Investors Abroad

by Ulrika Lomas, for LawAndTax-News.com, Brussels

05 September 2008

The plans recently announced by Greek Finance Minister George Alogoskoufis to introduce a 10% tax on capital gains and dividends from share sales have the potential to force investors overseas, a body representing brokers claimed on Thursday.

Earlier in the week, the Finance Minister was also obliged to defend the introduction of his tax package from an attack by unions.

The measures, including the 10% tax on capital gains from share sales, are being brought in to boost budget revenue and the public finances as the economy slows, and to keep the Greek economy on the right side of the EU's 3% of GDP budget deficit ceiling.

However, Alexandros Moraitakis, president of brokers association SMEHA, hit out at the proposals, announcing his plans to challenge the reforms via the legal system, and arguing that:

"The foreign and big domestic investors will find ways to avoid the new tax. Finally only the small Greek investors will be affected from the new tax on capital gains."

The reductions are due to come into effect from January 1, 2009, pending parliamentary approval.

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