Government Expects 3.7 Billion Euros in Revenues from Reforms Package
Tuesday, 31 March 2015
The Greek government expects revenues of 3.7 billion euros from the introduction of a reform package currently discussed with the country’s creditors in the Brussels Group.
These reforms include, among others, the introduction of taxes on Greek citizens’ deposits abroad – with an expected revenue of around 750 million euros - more favourable terms for repaying overdue debt to the state, combating smuggling and licensing of television stations. The government also envisages revenues of up to 1.5 billion euros from privatisations at Piraeus Port, regional airports and horse betting license.
The primary surplus is expected to surpass 1.2 pct of GDP this year, to around 1.5 pct, with the introduction of a package of reform measures with a fiscal impact of 3.7 billion euros. The biggest part of these revenue will come from controls on deposits abroad (725 million), combating tax evasion on VAT (350 million), licensing of TV stations (350 million), more favourable terms of repaying overdue debts to the state (600 million), simplification of income tax code (300 million), a lottery on retail receipts scheme (270 million), combatting smuggling on cigarettes and fuel (250 million) and new tenders for e-gaming (200 million).
GDP growth is projected at 1.4 pct this year, down from an initial estimate of 2.9 pct, and to 2.9 pct in 2016. The unemployment rate is expected to total 23.4 pct this year, instead of an earlier estimate of 22.6 pct, falling to 21.1 pct in 2016. The inflation rate will remain in negative territory this year (-0.5 pct), returning to positive ground (-0.6 pct) in 2016. These estimates are based on the assumption that the government will postpone a zero deficit clause for supplementary pensions and will re-introduce a 13th pension payment for low pensioners. The postponement of a zero deficit clause will cost 326 million euros.