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Greece Proposes 50 Percent Top Rate Of Tax

by Ulrika Lomas, Tax-News.com, Brussels

05 February 2016


The Greek Government is reportedly willing to increase income tax and social security contributions to avoid having to make cuts to its national pension system.

An assessment of Greece's latest bailout program got underway in recent days, with the country's creditors calling on the Government to cut expenditure through a reform of state pensions, being a key condition of last year's EUR86bn (USD94bn) bailout package.

However, according to local media reports, the Greek Government has formulated an alternative plan which would see the pension system buttressed with revenues from a 1.5 percent rise in social security contributions and the addition of a new 50 percent tax bracket. This 50 percent tax rate would apply to annual income in excess of EUR60,000. Currently, the top rate of income tax is 42 percent, on income in excess of EUR42,000.

In addition, the separate tax scale for self-employed individuals would be abolished in favor of a unified set of income tax rules.

To appease its creditors, Greece must find new tax revenue or spending savings to achieve a primary budget surplus of 0.5 percent of gross domestic product this year.

TAGS: individuals | tax | pensions | budget | tax rates | social security | Greece | individual income tax | Europe

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