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The bill for taxes on property is already being developed by the Ministry of Finance and is soon expected to be submitted to Parliament. Its key aspects include the creation of a unified property tax, which will replace the fee paid to the Electricity Company and the current property tax, an increase of the tax value of non-regulated property and agricultural land, as well as a reduction of the tax free minimum for first time home buyers, family property, donations and legacies. It should be noted that the tax bill which is currently in Parliament also includes measures which, as of 2013, will further burden property owners. Its provisions include:

- A full taxation of incomes from real property by a factor of 10% for incomes of up to 12,000 euro and 33% for higher incomes. This means that smallholders with incomes only from rents will be burdened, and taxpayers who have incomes from properties in addition to other sources of income will benefit. The additional tax on rental income will remain, which amounts to 1.5% of rentals for housing and 3% for homes over 300 square metres and business areas.

- A 20% tax on the excess value of the sale of property. According to the new provisions, the difference between the acquisition value of the property and its value at the time of the sale will be levied. Acquisition implies either a purchase or other means of property acquisition. Acquisition value implies the value of the property at the time of acquisition as determined by the tax assessment or as recorded in the contract, if it is higher. The difference between the acquisition value and the selling price of the property will be taxed at rates of between 0.90% for 1 to 5 years tenure and 0.60% for more than 25 years tenure. The excess value tax will not be imposed on:

- profits from trading activities in the purchase and sale of properties;

- profits from the sale of real estate to legal entities;

- profits of up to 25,000 euro from the sale of property, if it was owned at least five years. This exception does not apply to individuals having more than one property transfer within five years.

- Cancellation of the tax exemption which provided for a reduction of the 10% tax rate for interest on mortgages and rents.

- The legislation includes the decision of the Ministry of Finance, made in early 2012, providing for property owners who cannot pay taxes and want to divide it from the electricity bill, to be able to approach tax authorities and pay 50 euro, so that this division be confirmed.

It is noted that the amount of the non-taxable minimum for the new tax, which will replace the fee to the Electricity Company and property tax, has not yet been defined. It is expected that the final decision will be made after the Holidays by the inter-party Commission which will make an agreement on the main points of the new tax regime, which will provide the following:

- A non-taxable minimum of 50,000 or 100,000 euro tax value of the property

- Rates for individuals starting from 0.1% or 0.15% and reaching 2% or 2.5% for real estate, when the tax value exceeds 3, 4 or 5 million euro

- For legal entities, the property tax will be levied not only by the three coefficients that are valid today (0.1%, 0.3% and 0.6%), but by 10 coefficients according to the use of the property (commercial, industrial or other needs). For property of the Orthodox Church, tax exemption for churches will still apply.

- A new tax on agricultural land

- Professional farmers will not be exempted from the tax, but a tax-free threshold will be introduced which will be related to the size and value of the land

- A new tax on non-regulated properties

- Property tax assessment will not increase, despite the agreement, confirmed by the memorandum, and the Ministry of Finance will tackle assessment expansion across the country.

The most important change in the tax regime will be the unified tax that will replace the fee paid to the Electricity Company and property tax. Some 3 billion euro are expected to be raised in 2013, as this amount includes outstanding amounts of property tax since 2010, 2011 and 2012, as well as special charges on real estate.

As part of the overall plan for detecting illegal money and tax evasion, the government is considering the option of re-including the clause on the origin of the property before 1 January 2014.

In 2013, the following is expected:

* A 50% reduction of the non-taxable minimum for first home acquisition. Currently, this minimum amounts to 200,000 euro for singles, 250,000 for families, and it is increased by 25,000 euro for each of the first two children and 30,000 euro for the next.

* A 33% reduction of the non-taxable minimum for family housing and legacies with changes in coefficients. Today, the minimum amounts to 150,000 euro. The part of the property above the minimum and up to 300,000 euro is taxed by a 1% factor, from 300,000 to 600,000 euro - by a factor of 5%, and more than 600,000 euro - by a factor of 10%.

* The introduction of a scale for taxation of property transfers. Currently, the transfer tax is calculated by a factor of 8% - 10%, as up to the first 20,000 euro of the value of the property are levied by a 8% factor, and the excess value - by a 10% factor. In Austria, for example, the tax on transfer of property amounts to 3.5%, in Portugal - 1% - 6%, and in Norway and Bulgaria - 2.5%.