Easter bonus of up to 300 euros for 1.1 million Greeks

A budget of more than 1.5 billion euros for extra interventions has been put aside by the government staff, which will be gradually start rolling out from the spring.

Prime Minister Kyriakos Mitsotakis gave an overview of the new measures that will be announced and those that have already been passed at the press conference.

On the table is the payment of an extraordinary bonus at Easter close to 300 euros, a reduction or even abolition of the service fee, a reduction in contributions and the payment of retroactive pensions to all pensioners. The height and scope of the new measures will depend on the course of energy prices, but the main objective of the government is that the interventions should be aimed at strengthening incomes.

The “Easter bonus” will amount to 250-300 euros, it will be a “breather” especially for the vulnerable and pensioners. In addition to vulnerable pensioners, it is estimated that disability benefit recipients, the long-term unemployed, uninsured seniors, guaranteed minimum income recipients and child benefit recipients will receive the ‘Easter bonus’. These are 1.1 million beneficiaries who will collect a total of approximately 300 million euros.

Tax reductions

The government’s quiver has included measures that work in the direction of relief and support for the middle class and professionals. As “TA NEA” newspaper has revealed weeks ago, one of the measures is a gradual reduction for the tax declarations of 2024 and then the complete abolition of the business tax fee in 2025.

Plans are under development for a tax relief package which is expected to be implemented periodically and over a period of four years. It includes relief for employees with interventions in the tax scale and rates, but also a reduction in entrepreneurial tax, a cut in VAT rates and the abolition of the business tax.

A review of the tax regime for 1 million professionals and the self-employed is expected with the aim of broadening the tax base and limiting tax evasion from undeclared income and VAT.

The size of the new measures

The final decisions on the amount of new interventions will be made after February, as until then revenues recorded in the 2022 budget will be collected. In the next two months, revenues will be collected which will be recorded in last year’s budget, such as road taxes, income tax installments, etc. .etc Also, the last tranche of the central banks’ profits from the Greek bonds (ANFA) of 600 million euros, which have not yet been collected, is expected.

Sources of the Ministry of Finance put as a key factor the course of natural gas prices, which will determine the course of the Greek economy during the first half of 2023, as well as the target for the fiscal outcome.

Current prices also leave room for extra intervention, as €600 million of the €1 billion cushion the government have been set aside for measures can be put to other uses. Economic staff personnel leave open the possibility of a better performance on the deficit, which could fall below initial forecasts of 1.6% of GDP for 2022. That means better performance for 2023 as well, even if the 2022 GDP from 5.6% (estimated) to 6%.