Thessaloniki International Fair – Tax package for civil servants and retirees

In the coming days, the government will lock its decisions to abolish the solidarity contribution to civil servants and retirees, the average reduction of 8% of ENFIA in 2022, while at the same time proceeding with smart measures to reduce tax evasion that will be returned to it next year to reduce further income tax rates.

In the heavy atmosphere created by the catastrophic fires of August, the Prime Minister Mr. Kyriakos Mitsotakis wants to send from the podium of the Thessaloniki International Fair on Saturday, September 11 a message of restarting the country with basic weapons, further reduction of taxation and A recovery through which 1.5 billion euros will be given for the civil protection and shielding of the country against the climate crisis.

The announcements will have a horizon of two years, so as to cover the political time of the national elections, which according to the constitutional deadlines must be announced by the spring of 2023.

A crucial issue for which a decision of the European Commission is needed is whether Brussels will finally give the green light not to return all the aid given to professionals and companies in the form of a repayable advance during the pandemic period. The Ministry of Finance is keeping their papers closed on this issue, while according to secure information, the amounts they have received are expected to appear in Taxisnet accounts within September, what part of them should be returned to the state and what options the professionals have and the companies for their repayment on the basis of those provided in the relevant decisions that have been signed.

According to the current payment of the repayable advances will start from January 1, 2022 and one can either pay a lump sum and have an additional 15% discount on the amount to be refunded or pay the total repayable amount in 60 monthly installments.

However, according to information, it is not excluded that the date of payment of the first installment may be postponed in order to further facilitate professionals and companies in the repayment of the refundable amount.

For whom the solidarity contribution is abolished

About 570,000 civil servants and 1,300,000 retirees with a main and auxiliary pension of more than 1,000 euros per month will see a reduction in their taxes next year from the abolition of the solidarity contribution to their incomes, which is being launched according to secure information from the Ministry of Finance. This abolition will be reflected in the monthly salary or pension from the very first month of payment as the monthly withholding tax will be reduced. This is also the case with private sector employees this year and is set to apply in 2022. The only ones who have so far been left out of the abolition of the solidarity levy are civil servants and retirees of all Funds.

It is recalled that last April the Prime Minister had announced the extension of the reduction by 3 percentage points of the insurance contributions of private sector employees for 2022, as well as the suspension of the special solidarity contribution in the private sector for the year 2022.

The solidarity levy was abolished for incomes 2020 and 2021 for farmers, self-employed, income earners and dividend holders, with the benefit appearing respectively in the tax returns submitted this year and those to be completed in 2022.

For the employees of the private sector, the suspension of the solidarity contribution is seen in the incomes 2021 and 2022, and in fact directly in the monthly withholding of the tax. For pensioners of all Funds and civil servants who have an annual income of more than 12,000 euros (a threshold above which this tax is imposed) there has been no change in the solidarity contribution, which is expected to happen from 2022.

The Ministry of Finance is studying, in addition to extending the suspension of the solidarity contribution to civil servants and retirees, to apply this beneficial provision to the incomes of 2022 farmers, self-employed, income earners and dividend payers.

In terms of corporate taxation, the rate reduction from 24% to 22% applies to both this year’s profits and the coming years, unless there is a further reduction to 20%, although at present it does not appear to be such a thing is preferred.

Reduction of ENFIA property tax by 8%

Reduction of ENFIA by 8 percentage points is expected to be foreseen in the 2022 budget. According to recent statements of the Minister of Finance Mr. Christos Staikouras the new ENFIA will be determined in November. “Then we will have a picture of the exercise that is running and incorporates the new objective values. We are committed that there will be no total burden on ENFIA. It is a fact, however, that there have been distortions in recent years, between objective and commercial values. And these distortions must be addressed. At the same time we have a pending further reduction of ENFIA by 8%. As we had promised before the elections, our first action was to reduce ENFIA by 22%. This backlog exists and is among what we are examining for 2022 “.

Smart measures against tax evasion

The Ministry of Finance plans to bring to a vote in Parliament tax incentives to ask citizens for receipts and reduce widespread tax evasion in an effort to increase public revenues and to better plan tax policy. At the same time, the question is whether the new system for recording all transactions through the My Data system will finally be implemented from September 1, as there is a high possibility that a new extension will be given and will finally take effect from the new year.

The Independent Public Revenue Authority is working feverishly for the new application to be put into mandatory operation from September 1, but both the catastrophic fires and the evolution of the pandemic seem to be slowing down the whole effort and therefore it is estimated that another three-month extension will be given so all businesses can adapt to the new environment.

In the new platform of Electronic Ledgers – My Data, the companies, if there is no new extension, will have to digitally transmit the documents they issue (invoices, etc.) from the 1st of September onwards. Public Revenue e-Books are the digital platform for the fulfillment of tax obligations of all companies and are expected to lead to the automation of the completion of tax returns and the release from the obligation they have today to submit Customer – Supplier Statements (MYF).

At the same time, the Independent Public Revenue Authority looks forward to the completion of the online interconnection of 600,000 cash registers and POS with the tax and control authorities by the end of the year. The electronic interconnection of business accounting with the Tax Office will enable more efficient intersections and reduce widespread tax evasion.

Double receipts and tax deduction

As for the incentives that the government plans to apply to the citizens to ask for receipts, according to exclusive information of “Vima tis Kyriakis”, the Council of Financial Experts of the Ministry of Finance examines all the data that exist either in the banking system or in the Taxis data (income tax returns, VAT, etc.) in order to decide for which sectors – categories of companies and professionals, citizens should have additional incentives to request receipts, in order to reduce tax evasion.

In the basic scenarios is the oversupply of expenses, ie receipts from certain categories of companies and professionals to count double or triple for the construction of a tax-free ceiling, while a percentage of the amount of this receipts is considered to be returned to the consumer, but the rate of tax deduction has not been decided yet.

every monthAt the same time, there will be a complete overhaul of the tax system so that 1,000 euros are not given to 1,000 lucky people but to give much more important amounts to a smaller number of taxpayers, in order to “hunt down” the receipts. In fact, drawings are being made for houses that have come to the State from confiscations. All this is done so that almost all transactions are made with plastic money and an entrepreneur or professional can not avoid issuing a receipt.

In the coming days, the government will lock in its decisions to abolish the solidarity contribution to civil servants and retirees, the average reduction of 8% of ENFIA in 2022, while at the same time proceeding with smart measures to reduce tax evasion that will be returned to it next year to reduce further income tax rates. In the heavy atmosphere created by the catastrophic fires of August, the Prime Minister Mr. Kyriakos Mitsotakis wants, on Saturday, September 11, to send a message from the podium of the Thessaloniki International Fair, of restarting the country having as its basic tools, the further reduction of taxation and a recovery through which 1.5 billion euros will be given for the civil protection and shielding of the country against the climate crisis.

The announcements will have a horizon of two years, so as to cover the political time of the national elections, which according to the constitutional deadlines must be announced by the spring of 2023.

A crucial issue for which a decision of the European Commission is needed is whether Brussels will finally give the green light for not to return all the aid given to professionals and companies in the form of a repayable advance during the pandemic period. The Ministry of Finance is keeping their papers closed on this issue, while according to secure information, the amounts they have received are expected to appear in Taxisnet accounts within September, what part of them should be returned to the state and what options the professionals have and the companies for their repayment on the basis of those provided in the relevant decisions that have been signed.

According to the current payment of the repayable advances will start from January 1, 2022 and one can either pay a lump sum and have an additional 15% discount on the amount to be refunded or pay the total repayable amount in 60 monthly installments.

However, according to information, it is not excluded that the date of payment of the first installment may be postponed in order to further facilitate professionals and companies in the repayment of the refundable amount.

National Bank of Greece: GDP jump 13% in the second quarter

The upward dynamics of the economy in the period April – August is recorded by the Studies Department of the National Bank, which specifically predicts that the GDP of the 2nd quarter is now estimated to grow at a rate of over 13% per year. The whole year will close with a growth rate of 5.7%, if the trend is not affected by the Delta mutation and the pandemic. Particularly encouraging are the indications for July and August, where it seems that the rapid rise of inbound tourism – approaching the levels of the respective months of 2019 – is combined with increased private consumption and strengthens the already strongly upward trajectory of production.

Additional charges by mistake of EFKA in social security contributions

Heaps of errors have been found in the notices of contributions posted by EFKA on August 2 and concern insured self-employed with parallel paid employment. Thousands of insured persons who are both salaried and self-employed are essentially required to pay “double contributions” as the contributions they have already paid from paid work have not been taken into account by mistake.

Social security fund EFKA – indirectly – has accepted the existence of errors in the notices and for this reason invites the insured who find differences to make an electronic appointment with the competent Directorate of Contributions.

It should be noted that for the insured who have a debit balance, this can be paid in six equal monthly installments, with the first installment being paid on time until 31.8.2021.

The specific contributions concern self-employed, professionals, and farmers who were employed for a part or the whole year, and have paid the contributions corresponding to their employment based on their insurable earnings.

These categories are required to pay only if the contributions paid are lower than 262 euros (2nd insurance category plus 10 euros for unemployment). Unless the insured has chosen a larger insurance category, in which case he will pay more.

According to complaints, the recently completed liquidation has serious errors, with the result that policyholders who with their contributions from paid work largely cover the contributions of the second insurance category, are required to pay significant amounts as a residual debt.

EFKA executives point out that the insured who believe that there is an error in the liquidation should submit their request by phone (at 1555) and will receive in a short time the final answer of the institution. If they still have a problem, they will have to make an online appointment in order to finally solve their problem.