It is crucial for the recovery of the economy that the negotiations with the troika which begin today – ahead of the tabling of the budget draft next Monday – are conducted smoothly and without delays, which only increase the sense of uncertainty. It is equally important though to agree on a series of tax reforms which will not have a great fiscal cost, but will offer some relief to households and the economy.
It is a fact that during the crisis the taxation of real estate has increased excessively and disproportionately to the taxpayer’s capacity. The changes planned by the Ministry of Finances – reducing taxes on parental benefits, donations, inheritance etc – may not be a solution to the problem, but they might give the construction sector a small boost. IN an almost dead market, where the market value of property has dropped by about 40% yet taxable values remain unchanged, there is no revenue for the public coffers, nor is anyone willing to invest, even if they have the financial capacity to do so.
It is high time that the troika officers realized that the tax raids on real estate have a limited scope, as the taxpaying capacity dwindles. The gradual reduction of taxes and balance with reality is not just necessary, but it is rather imperative if the State wants to collect revenue. The small tax cuts and exemptions that are on the table are a first, small step that must be followed up by reviewing taxable values and rationalizing the taxation of real estate, in order to tax revenue from actual possession and not punish those who have invested their efforts of a lifetime.
TO VIMA
