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Greece promises to pay its debt to the IMF; will impose new taxes

01 March 2015 / 17:03:26  GRReporter
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Greece will prioritize its debt to the IMF, part of which matures in March. But payments to the European Central Bank belong to a different category and should be discussed with the creditors. This is what the finance minister, Yannis Varoufakis, said in an interview with Associated Press.

Varoufakis emphasised that Greece would negotiate a rescheduling with creditors, so that the country’s huge debt is made viable. Along with that, work on the reforms will go on until they are finalized in April.

"While paying back, we will definitely give precedence to the IMF. We don't want to be the first country that failed to meet its obligations to the IMF. We will part with our bottom dollar, if we have to, and live up to our commitments," Varoufakis said.

"As far as the payments to the ECB are concerned, they belong to another category: this is a matter, which should be resolved together with our partners and with the institutions," argued the minister.

Varoufakis claimed Athens would not request a postponement of payments to the ECB, but will seek another kind of agreement that will make repayment easier for the country.

Associated Press talks about the agreement between the Greek government and Eurogroup, as well as about the necessity that Greece put forward a series of reforms, which will translate into concrete measures up until April.

"The April agreement refers to the measures and it is binding for us," stressed Varoufakis. "Having said that, and regardless of the April agreement, which is based and focused on the reforms, we would like to discuss with partners and institutions the issue of the debt’s viability and restructuring," he added.

"We have committed ourselves to sustaining balanced budgets. What does this imply? It implies that we are striving to restore the country's independence and the people’s sovereignty through making sure that we never again experience the humiliation of having a primary budget deficit. If necessary, I will impose an additional tax for the purpose, but only for those who can pay it rather than for those who can’t ... Apparently, it will be a targeted tax," Varoufakis said in another interview for SKAI TV.

The minister explained that the haves, who constitute a part of today's revenue shortage issue, "must be hit, and will be hit mercilessly." Varoufakis emphasised that "paying our taxes is a part of our patriotic duty." Commenting on his popularity of late, he noted that those who hailed him would have to pay their taxes too, while those who have the money but failed to pony up, would be hearing from him.

Varoufakis said he was ashamed of the fact that there were Greeks, who even paid tax on the first euro they earned, and pointed out that non-taxable income would start growing gradually after June, with the ultimate target being €12,000.

The minister explained that VAT would see a hike neither in the Aegean, nor in the border areas. Still, Varoufakis left open the question of a possible VAT increase in areas like tobacco, alcohol and gambling.

Meanwhile, PASOK’s president, Evangelos Venizelos, sharply criticized the government and Varoufakis personally over his statements on SKAI TV about the introduction of an additional tax.

"A month after the elections, we are in an absolute hole, everything is up in the air ...", Venizelos fumed. He believes everything points toward a new, third memorandum, after June, complete with new loans. PASOK’s leader claimed Greece is in a worse position than before, although it has avoided bankruptcy after five years of crisis.

Venizelos said it was proven for a fact that there is no ‘plan B’, and that any attempt to change the original plan leads to further deterioration. He added that PASOK supports the government in the negotiations, as long as they are real. He urged the government to recognize the fact there was no other national strategy, but the one backed by PASOK, and to admit that they had made a mistake.

PASOK’s leader accused Alexis Tsipras for having addressed the people on Friday, without telling them the truth, and slammed the proposed bills.

Referring to Varoufakis’ interview for SKAI, Venizelos said that the government only unveils its intentions "as long as we have a finance minister who loves listening to his own voice." He asked when Varoufakis made plans if he was spending all his time talking to the media. Venizelos accused the government of spreading the myth that Greece was making headway while it was actually trapped. He stressed that the government was doing its best to stand clear (‘like the devil from incense’) of any parliamentary discussion or vote on the extension of the Memorandum.

As regards the proposal for establishing a commission of inquiry into memorandum-related issues, Venizelos said that "this is the most delightful news of recent days and PASOK will gladly vote for it."

Tags: Yannis Varoufakis interview extraordinary taxes loans IMF European Central Bank Evangelos Venizelos
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