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Greek Tax Regulations

Contents

Intro

The below is a brief description of some Greek Tax Regulations for 2013, notably the income taxes.

Sources

The following data is sofar not justified by official sources, hence it can be erranous. The main source are currently two blog posts on the blog griechenland-blog. The blog used mongst others an article in the newspaper Imerisia as a source. According to the blog the following taxes are part of a law, which was installed in Jan. 2013. The blog taxexperts provides similar numbers. The wikipedia article Taxation in greece is not uptodate. Ernest and Young’s Tmagazine seems to agree at least partially however their disclaimer sounds so scary that I preferred not to link to the corresponding information. WSJ journal seems to have something which is behind a paywall.

The two blog posts (in german) are Neue drakonische Steuermaßnahmen in Griechenland and Eskalation des Steuerwahns in Griechenland

Description of Employers and pensioneers taxes

The employers taxes are linear with the following tax factors for the respective incomes:

22% for the first 25.000 Euro income per year,
32% for the next 17.000 Euro (i.e. from 25.001 to 42.000 Euro) and
42% for everything above 42.000 

There is a tax exemption limit of 2100 Euro, which is reduced by 100 Euros for every 1000 Euros more income up to an income of 42000 Euros. This tax exemption is however only available if 25% of the income had been made in to luxury goods (receipts have to be brought)

The above taxes seem to have no correction with respect to the respective factors, i.e. there are rather big steps in the actual absolute taxes, as an example:

0,21*25000 = 5250

0,34*25001 = 8500,34

8500,34-5250 =3250,34

If one includes the tax exemption then on has:

5250-1700=3550 (1700 comes from 25000-21000=4000, 2100-400=1700)

8500,34-1600=6900,34

6900,34-3550=3350,34

I.e. if the data is correct then someone who earns 25001 Euros a year has to pay more then 3000 Euros more then someone who earns one Euro less.

Description of Freelancer and commercial taxes

26% for the first 50.000 Euro (no tax exemption!) 
33% for over 50.000 Euro 

Moreover there seems to be a fictitious minimal income of 3000 Euro. As the blog points out as a consequence one finds that:

“Ein Arbeits- oder / und gar Obdachloser, der aufgrund der neuen Bestimmungen obligatorisch zur Abgabe einer Einkommensteuererklärung verpflichtet ist, wird auf Basis der “Lebenshaltungsindizien” allein aufgrund der Tatsache, dass er überhaupt lebt, mit einem fiktiven Mindesteinkommen von 3.000 Euro veranlagt. Da er mangels eines realen Einkommens kaum in der Lage sein wird, einen “Konsum” in Höhe von wenigstens 25% des imaginären Einkommens bzw. 750 Euro nachzuweisen, hat er eine Steuer in Höhe von 660 Euro (22% Einkommensteuer) + 165 Euro (22% Strafsteuer wegen fehlender Quittungen / Rechnungen) = 915 Euro zu entrichten!”

translation without guarantee:

An unemployed or homeless, who has - according to the new regulations - to hand in a tax declaration, will be - just on the base of his “living indications”, i.e. alone by the fact that he is “alive” charged with a minimal income of 3000 Euro. Since he won’t be able to spend 25% of his income for “consumption”, i.e. 750 Euro, there will be no tax exemption and thus he would need to pay 660 Euros (22% income tax)+ 165 Euro (fine because of missing receipts) = 915 Euro!

Description income from rents

Similar big steps in taxes seem to exist for property taxes. The taxes for income from renting out property are according to Griechenland-blog

10% for the first 12.000 Euro
33% for over 12.000 Euro 

plus about 5% processing tax.

category: economics, politics, tax