Greece is once again exposed for its performance in direct taxation.
On the one hand, the European Commission ranks Greece in 16th place in the EU based on “fair” proportional taxes as a percentage of GDP and at the same time the OECD brings the country to the 4th worst position among member countries for the total deductions imposed on a family with one worker and two children.
Greece… dependent on indirect taxes, manages to combine a double negative performance: it does not collect as much as other European countries from direct taxes and it taxes citizens heavily, especially employees with families.
The findings are rather important in view of the government’s announcements at the Thessaloniki International Fair (TIF) in September. A large part of the available fiscal space is expected to be focused on improving a problem appearing at many levels: addressing high prices, demographics, housing crisis.
How is this happening? High prices and the housing crisis are addressed only if net increases in wages are greater than increases in products and services (in this case, for housing, rents or real estate sales prices). However, as long as income taxes contain real increases, the relationship does not improve. At the same time, employers and employees are looking for ways to avoid taxes under the burden of high rates, and thus the State’s receipts from direct taxation are also being cut.
