OECD Calls For Comprehensive Tax Reform In Greece

by Ulrika Lomas, Tax-News.com, Brussels

01 July 2002

In its Economic Review of Greece, published on Thursday, the Organisation for Economic Cooperation and Development (OECD) acknowledged that 'Greek economic performance has been remarkable since the early 1990's for its strong growth of productivity and output', but cautioned that comprehensive tax reform is necessary in order to reduce compliance costs and broaden the country's tax base.

In addition to reducing the complexity of the Greek tax system and broadening the tax base, the OECD report recommends that tax reform should 'tackle the uneven distribution of the tax burden, for example by eliminating the current bias in favour of unincorporated enterprises'.

Although the economic review recognises that the Greek government has plans to address inequalities in the country's tax system this year, and to this end has introduced a package of measures addressing the uneven taxation of capital income and the high cost of tax administration, among other issues, the OECD argues that the measures only partially address the problems of the tax system in a 'piecemeal' fashion.

However, the OECD report went on to praise the proposals for tax reform put forward by the government-appointed Special Commission of Experts, calling the plans 'far reaching'.

'The proposals have been discussed with the social partners, and it is expected that a draft law for a comprehensive tax reform will be submitted to parliament by the autumn,' the review revealed.

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