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Tax assessments of real estate freeze

11 July 2012 / 18:07:17  GRReporter
2907 reads

Victoria Mindova

The crisis has made equal the market prices and tax assessments of real estate, so that a new increase in the tax value probably will not be necessary, Deputy Minister of Finance George Mavraganis said at his first meeting with journalists. This has been interpreted as good news by the people in the market, who resented until recently the inadequate increases in tax assessments of real estate despite the collapse of the real estate market in Greece. "Market values ​​have already adjusted and therefore, there is no need for further interventions," said the Deputy Minister, who will deal mainly with tax policy issues at the Ministry of Antonis Samaras.

Despite the good will of the new Deputy Minister of Finance, the decision to freeze the tax values ​​of real property must be discussed with the supervisory Troika of the European Central Bank, the European Commission and the International Monetary Fund. This measure has been set in the bailout agreement and should be discussed before its full cancellation.

Mavraganis announced that there would be a new tax system in Greece in 2013. The first draft of another bill on the reform of the tax system would be ready in September. The Deputy Minister promised that it would not be voted before being discussed with the other political partners of the government and the opposition. Like his predecessors, he promised that the tax system would be simpler, more transparent and more efficient after the changes introduced by the government. Next year, there would be a property register, which would include all individuals in Greece. It would become a major source of information on the movement of funds. If the declared and bank assets do not correspond to the individual revenues, an inspection would follow.

One of Mavraganis’ first tasks was to meet with the heads of the 36 largest regional tax offices that collect around 80% of total tax revenues in the country. For the first six months of the year, the difference between planned and achieved in the collection of taxes was 1.4 billion. According to the data of the Ministry of Finance, the current account deficit was 3.15 billion euro, whereas the total budget deficit was 12.3 billion euro. Tax experts explain that the deepening recession has been hampering tax collection. Taxpayers are unable to meet the obligations accrued to the state and the shrinking economy is making the achievement of budgetary targets even more difficult. Total revenue in the treasury does not exceed 23.4 billion euro, which is about 1.4 billion less than the figure set at the beginning of the year.

The delay for the submission of tax returns for 2011 allowed by the Ministry of Finance played its role in the low state revenue too. The deadline is now scheduled for 16 July but some analysts do not exclude another delay for the submission of tax returns.

One way to improve the revenue is to fight black trade, which has reached record levels in Greece. The turnover of illicit trade is around 20 billion euro, the head of the tax police in Thessaloniki Dimitris Mavridis said. Replicas of original brands are imported mainly from Italy, Turkey and Bulgaria, the tax expert said. They are widespread on the market and are usually imported in the country via vehicles with hidden cabins, which declare the import of other goods. Mavridis is clear that the black trade in the country cannot be destroyed but it may be reduced to lower levels with the help of border authorities and municipal police.

Tags: EconomyMarketsReal estateGreeceTaxation
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