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Victoria Mindova

Lower corporate tax, simplified procedures and consistency and transparency in supervision are the key changes that will give Greece the basis for restoring the economic growth, says the Athens Chamber of Commerce and Industry. It presented to journalists a research outlining the basic problems of the Greek economy and giving concrete proposals for changes of the economic policy that will achieve better results in a shorter time.

The businessmen proposed the corporate tax to be 15% instead of the 24% applied currently and to fix its value for at least five years so that the companies in the country can plan their operations in the medium term. "If public revenues are to be increased in times of recession, tax rates are not to be increased but reduced," said the professor of economics at the University of Athens Yannis Varoufakis, who carried out the research commissioned by the Athens Chamber of Commerce and Industry.

Businessmen and economists are adamant that Greece can not compete with neighbouring countries such as Bulgaria and Cyprus, when there is such a significant difference in one of the basic tax rates. Such a step is the right direction on the European level too at a time when the countries of the old continent need more than ever to harmonize their tax policy to resist the global pressures and to reduce the imbalance in the euro zone.

The cumbersome administration, the constant changes in tax laws and the significant difference in tax rates with the surrounding countries make Greece extremely uncompetitive in the fight for direct private investment.

The President of the Chamber Kostadinos Michalos said that if the government wants to increase the revenues in the treasury it should stop the changes and additions to the tax system. "It is frustrating that the government voted four tax laws and five amendments in 18 months," said the businessman. Yannis Varoufakis added that Greece has a legislative framework that should not be complemented, but simplified. "Tax evasion does not require new laws but good management and application of the existing ones," he explained. He said the inability of the government to collect the planned revenue is not the result of a lack of legal framework but of a lack of management of the tax services.

The deepening recession and rising unemployment are the direct effects of hostility demonstrated by the public sector to the entrepreneurship, economists say. Kostadinos Michalos stated that there is mutual distrust between public and private sectors in Greece, which leads to a vicious circle and hinders the improvement of the economic environment. The results of this distrust are the low companies’ turnovers and the reduced tax revenues.