Championship in training camps both in direct taxation and indirectly our country, in comparison with most European countries and in any case the Balkan zone, as can be seen from the statistics OECDher European Union. and tax base. However, the country maintains a positive lead for corporate shareholders as the dividend distribution tax is the lowest in the EU. Of course, even in this case, there are countries that do not levy a distribution tax or, more broadly, taxation, both at the level of management and in procedural matters, attracts investors.

The dialogue on the tax system has already begun at conferences and forums, where the business world and individuals are waiting for the programs of the parties to see how the situation can change.

Thus, for individuals, families with children, as the OECD data show, pay especially high taxes and contributions, despite the reductions and improvements made compared to previous years. In particular, Greece ranks 9th in the OECD in terms of the percentage of gross revenue absorbed by the government in the form of taxes and contributions (tax wedge) in the above category. In particular, the tax wedge for the average married worker with two children is 33.2%, while the OECD average is 24.6%.

Business is doing better when it comes to taxation. In recent years, the rate has been set at 22%, with the tax on dividends reduced to 5%.

The problem is mainly related to the taxation of businesses, the fact that the state does not keep up with developments in helping entrepreneurs to be competitive.

On the other hand, one of the big problems is high indirect taxes. Greece ranks fifth in the EU in terms of VAT rate. and from higher excises on gasoline. What consumers have felt and continue to feel in their pockets, as a result energy crisis.

“Gold sponsors” of the tax, families with two children

During the memorandum years, the middle class bore the burden of fiscal adjustment, which continues to support government revenues. The latest tax reform in 2019, while improving the disposable income of citizens, excluded incomes over 18,000 euros. The benefits for them were minimal, with a maximum tax rate of 44% for incomes over €40,000. Debate on the new scale is expected to begin shortly before the vote, and public debate has already begun. But what appears to be one of the big problems also identified by the OECD is how families are taxed. Although the situation has improved, according to the latest released data, we are still far from the OECD average.

The average married worker with two children in Greece ends up with 81.9% of their gross salary.

Greece ranks 9th in terms of the percentage of gross revenue absorbed by the government in the form of taxes and contributions (tax wedge) in the OECD in the above category. In particular, the tax wedge in Greece for the average married worker with two children is 33.2%, while the OECD average is 24.6%. In fact, this percentage was higher in previous years, and its (slight) improvement is the result of a reduction in both income tax and insurance premiums.

Taking child allowances and tax provisions into account, the net average employee tax rate for the average worker with two children in Greece was 18.1% in 2021, the 13th highest in the OECD when the average is 13. 1%. This means that the average married worker with two children in Greece was paid after taxes and family benefits 81.9% of their gross salary, compared to the OECD average of 86.9%.

Enterprises

Our country is approximately at the average level in terms of the corporate income tax rate (22%), while, on the contrary, it maintains the lowest dividend tax rate. Of course, some countries have particularly low corporate rates of 10%-12.5%, others experience significant cost overruns, while others have introduced corporate and dividend taxes to attract investment.

Ireland has the highest maximum dividend tax rate of any European OECD country, at 51%, according to the Tax Foundation. They are followed by Denmark and the UK with 42% and 39.4% respectively. However, Ireland and Cyprus are a business magnet, charging the same rate of 12.5%, which is one of the lowest in the Eurozone and one of the lowest in Europe.

Estonia and Latvia are the only European countries that do not tax dividend income. This is due to their cash flow based corporate tax system. Instead of taxing dividends, Estonia and Latvia levy a 20% income tax when a company distributes profits to shareholders.

Of the countries that tax dividends, Greece has the lowest tax rate at 5%, followed by Slovakia at 7%. In European OECD countries, the average maximum tax rate on dividends is 24%.

It is noted that in many countries corporate profits are subject to two levels of taxation: corporate income tax at the enterprise level, when the company earns income, and tax on dividends or capital gains tax at the individual level, when this income is transferred to shareholders. . Some countries, however, have combined corporate and dividend/capital gains taxation to eliminate this double taxation.

According to financial advisers, one of the reasons for the low dividend rate in Greece is that a Greek shareholder has almost the same treatment as a foreign shareholder, who is exempt from dividend tax.

In general, Greece can become a magnet for investment, as the tax rate here is not one of the highest in the EU. However, the “splinter” identified by people on the ground is mainly related to procedural and administrative issues, which often force them to give up. And this despite the fact that the Greek state is slowly adapting to the events. It is significant that the startup did not know how to evaluate its services for a long time, and another innovative company could not find which CAD it belongs to.

Among the highest VAT and excises in the EU.

Greece is among the top 5 European countries with the highest VAT rates, despite the fact that discussions have already begun in Brussels and fundamental decisions have been made to allow our country to continue reducing rates. Also, the government’s position on a large reduction in revenue from a possible VAT reduction may not be true, as history has shown that the higher the rates, the greater the tax evasion.

According to the data, only Hungary, Croatia, Denmark and Sweden have a higher VAT than Greece, and they are all outside the eurozone. In fact, Greece and Finland lead the Eurozone with 24%.

Only in Hungary, Croatia, Denmark and Sweden VAT is higher than in Greece.

The lowest standard VAT rates are in Luxembourg (17%), Malta (18%), Cyprus, Germany and Romania (all 19%).

In Greece, more than 40% of its total tax revenue comes from indirect taxation (at least 10 points above the EU average), and the ratio in terms of GDP is over 17%, compared to the European average of 13%. In many areas – fuel, food, heating oil, etc. – Greece has one of the highest VAT and consumption taxes rates internationally.

The Commission’s latest study on the “hole” in VAT revenue is revealing. What the European Commission measures every year is what is lost from potential VAT revenues, and especially for Greece, the picture has been the same in recent years. Our country annually loses more than 5 billion euros from VAT. And this is largely due to high VAT rates.

It is noted that in addition to the standard VAT rate, which cannot be less than 15%, Member States can apply one or two reduced rates, not less than 5% for certain goods and services, as well as a super-reduced rate below 5%. . However, only Ireland, France, Spain, Italy and Luxembourg apply reduced rates below 5%.

Consumption taxes

Greek consumers pay the fourth largest gasoline consumption tax in the EU. According to the legislation of the European Union, the minimum amount provided for the excise tax on gasoline is 0.36 euros / liter. Of course, only a few countries have adopted a minimum VAT rate.

The Netherlands ranks first with a tax of 0.81 euros/liter, followed by Italy with 0.73 euros/liter and Finland with 0.72 euros/liter. Our country, as mentioned above, ranks fourth, as each liter of unleaded gasoline is taxed at a rate of 0.70 euros / liter.

On the other hand, the lowest excise duty is levied in Hungary at 0.34 euros per litre. The next lowest excise duty is set in Bulgaria (0.36 euros per litre), followed by Poland and Romania with 0.37 euros per litre.

The European Union has set a minimum excise limit for its member states on diesel fuel of 0.33 euros/litre.

The EU imposes a slightly lower minimum excise tax of €0.33 per liter (US$1.48 per gallon) on diesel fuel.

Twenty-five of the 27 EU countries they levy a lower excise tax on diesel fuel than on gasoline. After the UK left the EU, which was in first place, Italy took over the reins with 0.62 euros / liter, and Belgium was in second place with 0.60 euros / liter.

Greece introduces a special tax on the consumption of diesel fuel in the amount of 0.41 euros / liter (13th place among the EU member states). The countries with the lowest diesel excise duty are Hungary, 0.32 EUR/liter (below the minimum threshold due to the exchange rate), Bulgaria and Poland, both of which have duties of 0.33 EUR/liter.