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Greek business prepares for a tax storm

23 June 2015 / 19:06:09  GRReporter
3217 reads

Measures for economic development, deep reforms, an effective public sector and equivalent measures to combat tax evasion and limit the waste spending of public funds are the proposals of business, instead of the government's package of measures worth 7.9 billion euro.

According to a senior manager at a subsidiary of a multinational company with a manufacturing presence in Greece who wished to remain anonymous, the proposed package of measures that include mainly increases in taxes and social security contributions will lead to belt tightening and will affect the disposable income of the Greek consumer. The same source indicates that "valuable time has been lost in recent months, which is apparent in consumption as well." As for the agreement, he states that it is crucial at this stage. The most important thing to him now is for Greece to carry out deep reforms and have a more efficient public sector.

Another senior official from a Greek manufacturing company with a strong presence abroad states, "We must first see what the reform package contains and what the final agreement will be," subsequently adding, "everything is welcome that will take us out of today's uncertainty and will be accompanied by concrete measures for economic development and structural changes."

The president of the Hellenic-American Chamber of Commerce: A different mix of measures is required

In a statement before, president of the Hellenic-American Chamber of Commerce Simos Anastasopoulos states that the proposal of the government is in the right direction, as it stops the country’s chaotic move towards bankruptcy. Nevertheless, the measures will lead to recession and rising unemployment. According to him, a different mix of measures is required, aimed at economic development.

In particular, Simos Anastasopoulos notes, "the government's proposal is clearly moving in the right direction as it seems to meet the requirements for the extension of the agreement and financing. On the other hand, the proposed measures will burden the private sector with new taxes or increased contributions, which will certainly lead to recession and rising unemployment. A proposal with a different mix of measures aimed at growth will satisfy the requirements and lead to a sustainable solution. However, in every case, the achievement of any agreement is better than the lack of it, which will lead to the collapse of the economy and the impoverishment of Greece."

The positions of the Athens Chamber of Commerce and Industry and the National Confederation of Hellenic Commerce

In a statement, president of the Athens Chamber of Commerce and industry Konstantinos Michalos harshly criticizes the package of measures proposed by the government. He believes that "although the Greek proposals are the product of strong pressure from the creditors of the country, they will have reverse effects in the Greek economy and market, not the expected ones."

According to Konstantinos Michalos "these are extremely recessionary measures, as they provide for a cruel taxation, mainly of businesses but also of society as a whole. Increasing taxes for companies from 26% to 29% combined with the 100% increase in advance tax payments will certainly cause a new wave of closures of companies and this time the victims will be the small and medium-sized companies."

The president of the Athens Chamber of Commerce and Industry notes that the additional 12% tax on the profits of the most powerful companies will be a punishment for them, adding that employment will seriously suffer because of the increase in employer contributions, which will be a strong counter incentive for new appointments.

Konstantinos Michalos urges the government to reconsider those positions that are against the private initiative and entrepreneurship, albeit at the last moment, and to seek equivalent measures mainly, associated with combating tax evasion and limiting the waste spending of public funds, where there is such.

The president of the Athens Chamber of Commerce and Industry completes his statement in the following way: "Businesses continue to support the position that reaching an agreement with creditors is preferable to a destructive rupture but they will also continue to seek and propose specific measures and policies in favour of an agreement that will bring fruit to the economy and society and will not drag the country into a deep recession."

For his part, president of the National Confederation of Hellenic Commerce Vassilis Korkidis states, "the final attempts to reach an agreement are certainly putting an end to the statements about an impending disaster and rupture with partners." Korkidis adds that "it seems the key is already in the lock and now our European partners have to turn it in order to conclude the agreement on the one hand and "unlock" capital to the amount of 35 billion euro for Greece on the other."

In connection with the Greek proposal and package of measures worth 8 billion euro, the president of the National Confederation of Hellenic Commerce states, "Many of the forecasts in the proposal are putting an additional financial burden on small and medium-sized companies, preserving the regime of austerity and the excessive taxes which will impede the recovery of the Greek economy in the second half of the year, because, as is known, apart from the favourable climate, the market needs money too." "Undoubtedly, the equivalent measures worth 8 billion euro that are included in the Greek proposal are a very heavy expense for the middle class of the country," states Korkidis.

Tags: BusinessPackage of proposalsNegotiationsCreditors
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