New rewards package from the Greek government based on the energy reserve & refinery surplus profits

The revelations have coincided with the budget debate for 2023

The government conducts "paper exercises" for new benefits using "vehicle" collections from the taxation of surplus earnings in refineries, the funds that will be left over from the reserve for energy, and the increased expansion of the economy.

According to competent actors' estimates, approximately €600 million of the €1 billion cellar provided by the budget to support households from energy price increases due to price restraint will remain unallocated, while at least €600 million will go to state funds from the imposition of a 90% tax rate on refineries' surplus profits at a pan-European level.

The threat of an energy catastrophe

At the same time, finance ministry officials note that, while it is too early to make safe and accurate estimates of GDP growth for the entire year due to risks and uncertainties associated with the energy crisis, they estimate that the rate of increase will not be slower than the new updated forecast of 5.6% growth in 2022.

After all, the 9-month average is higher than 5.9% (7.9% in the first, 7.1% in the second).

The movement in the Christmas market, which has traditionally had a major share of the entire yearly turnover of the retail sector, which surpasses 3.5 billion euros, will be a critical factor for fiscal flexibility.

Allowances

In this regard, the Ministry of Finance is thought to be considering additional interventions to compensate for some of the losses incurred as a result of the wave of price rises in energy and food goods, which the prime minister may announce in his statement to parliament during the budget vote.

The following are in the foreground:

- Extension of the subsidy at the pump for heating oil that expires at the end of December for another two months

. It should be noted that today the VAT subsidy amounts to 25 cents per litre

- Subsidy of the price of diesel fuel with an expiry date and in function with values.

- Grant of monthly punctuality allowance to the vulnerable with strict income and property criteria and as long as inflation remains at high levels.

The amount of the aid is expected to vary between 150-200 euros.

Electricity subsidies

Simultaneously, electricity subsidies will be maintained, with the amount of government assistance dependent on the direction of prices in the coming months and the goal of amortising up to 90% of surcharges on household bills.

They are also calculating the fiscal margins for the return of cuts to gifts and supplementary pensions for all pensioners based on the CoE judgement, despite the fact that such a move is anticipated to cost roughly 2.5 billion euros.

Retro actives are given in instalments as one option for "breaking" the budgetary strain.

Reduced taxes

At the same time, the government is planning a package of tax cuts that will be implemented over four years, with the first package being activated within the next year, and which includes tax relief for employees through changes in the tax scale and rates, a reduction in business tax, lowering VAT rates, and phasing out the pretence tax.

The Ministry of Finance has commissioned the production of a specific study for the examination of the existing system at IOBE with the goal of growing the tax base, providing incentives for tax compliance, and limiting tax evasion to income and VAT.

By fLEXI tEAM