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Greek Prime Minister Alexis Tsipras is returning to Athens after another meeting with the heads of creditor institutions. It is expected that from the airport he will set off to the government residence Maximou where the Council of Ministers will hold an extraordinary meeting at which he will inform the ministers on the negotiations and the new proposal of creditors to Athens.

Earlier today, it became clear that, during the meeting in Brussels this morning, the creditors proposed a five-month extension of the bailout programme and funding of 16.3 billion euro if an agreement were reached.

10.9 billion euro of them will be the remainder from the funds of the Financial Stability Facility, 1.8 billion euro will come from the last tranche under the bailout program and 3.6 billion euro from the profits of the Eurosystem from the Greek government bonds. In addition, the proposal provides for transferring the money to a special account for servicing the Greek debt. It will be divided into 4 instalments, according to the implementation of budgetary measures and reforms:

- The euro zone will allocate the sum of 1.8 billion euro for the payment of the loans to the International Monetary Fund, immediately after the Greek parliament votes on the first laws on the implementation of the measures.

- The second instalment amounting to 4 billion euro will be paid in mid-July, after Greece has fulfilled the first package of measures. These funds will cover the maturing Greek government bonds worth 3.5 billion euro that are purchased by the European Central Bank.

- 4.7 billion euro will be allocated in early August.

- Another 1.5 billion euro will be paid in October.

In parallel, the International Monetary Fund will provide its tranche of 3.5 billion euro in October and in the event that Greece has implemented the agreed reforms, its funding over the next 12 months will be ensured and its debt will be sustainable.

According to sources of the newspaper Kathimerini, Greece’s financial requirements by the end of the year will amount to 15.3 billion euro and complying with the disbursement programme will fully cover them.

Earlier the Greek media published the corrected proposal of the Greek side that it presented at yesterday's meeting of the Eurogroup. It is available on the following link: http://s.kathimerini.gr/resources/article-files/prior_last.pdf

The main differences between the positions of Athens and creditors are as follows:

- VAT - Greece proposes annual revenue amounting to 0.93% of GDP whereas creditors insist on it amounting to 1%. Athens insists on introducing a 13% rate for all food products, not only for the essential ones. The Greek government puts hotel services in the same category and wants to keep the status of reduced taxes that is in force on the islands. Unlike creditors, Athens has not included in the proposal a VAT reduction in the event of increased revenues from the fight against tax evasion and accelerated payment of taxes. The proposal of creditors indicates that this is likely to happen at the end of 2016.

- The Greek government insists on imposing a 12% tax on companies with profits of over 500,000 euro.

- It suggests a reduction of defence spending by 200 million euro in 2016.

- As for the income tax for companies, Athens accepts the creditors’ proposal to increase it to 28%, i.e. to make it 1% less than in its original proposal for 29%.

- The Greek government proposes to gradually abolish the payment of benefits to all pensioners by the end of 2018 whereas creditors insist on totally abolishing it by the end of 2019. In addition, they also want to immediately cancel the aid for 20% of those pensioners who are receiving higher pensions. Athens has no such proposal.

- With regard to health insurance for pensioners, Athens proposes an increase from 4% to 5% and creditors to 6%.

- The Greek government continues to push for an increase in social security contributions whereas creditors reject this measure.

- The proposal of Athens provides for eliminating early retirement after 31 October and creditors want this to happen as early as 30 June.

The Greek sources referred to by the online edition iefimerida.gr are adamant that the adjusted proposal of creditors is "worse than a memorandum." In turn, Alexis Tsipras said before his departure from Brussels that "the principles of Europe are not based on blackmails and ultimatums."

The government sources indicate that the aim of the Greek cabinet is to reach a package agreement because the funding itself is not sufficient. "The agreement should not recycle the vicious circle of recession."

According to the same sources, there are many scenarios on the negotiating table but "no decision on funding can be triggered under the proposal of institutions."

The last and crucial Eurogroup meeting on Greece will take place in Brussels at 03:00 pm Greek time tomorrow.