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Saturday 10 December 2016

The 13-page plan to free up €53.5bn bailout cash

proposals

Greece has submitted a 13-page set of proposals to its European creditors that is intended to act as a foundation to free up a new three-year, €53.5bn bailout package. Here are the main points that the Greek parliament were debating today.

BUDGET TARGETS:

The Greek government is pledging to stick to primary surplus targets - meaning that the government is earning more in taxes than it is spending - of 1pc this year, 2pc in 2016, 3pc and 3.5pc in 2017 and 2018 respectively.

SALES TAX REFORM:

The proposals include a slew of tax hikes including a 23pc value added tax on restaurants and catering, a reduced 13pc tax on basic foodstuffs, energy hotels and water and a so-called "super reduced" rate of 6pc on such things as pharmaceuticals, books and theatre.

FISCAL REFORM:

Military spending will be slashed by €100m this year and double that in 2016. Corporate tax will increase from 26pc to 28pc and farmers will lose preferential tax treatment and fuel subsidies.

PENSION REFORM:

The government is looking at reforms that would bring permanent savings of 0.25pc to 0.5pc of gross domestic product (GDP) in 2015 and 1pc of GDP in 2016 and beyond. The retirement age will be standardised to 67 by 2022.

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