Greek Parliament Approves New Property Tax

SE Times

The Greek Parliament approved a new property tax, aimed at helping the socialist government of Prime Minister George Papandreou meet the budget target under a 110-billion-euro programme of rescue loans from the EU and the IMF.

The unpopular measure was passed by the 300-seat assembly with the support of all 154 lawmakers from the ruling PASOK and one independent deputy.

The new tax, which will remain in force until 2014, is expected to bring about 2 billion euros into state coffers this year and help Greece meet the 17.5-billion-euro budget deficit target set down in the bailout agreement of May 2010.

The property tax law was endorsed on the eve of a new assessment of the Balkan nation's progress in fulfilling the terms of the multibillion euro emergency loan package by the European Commission (EC), European Central Bank (ECB) and IMF officials.

The troika's auditors were due to conduct the review earlier this month, but left Athens abruptly on September 2nd, following a row with Greek officials over the size and causes for the widened budget gap. A decision on the release of the sixth 8-billion-euro tranche from the rescue package was put on hold.

Meanwhile, Greece is expected to run out of money for covering its domestic and international obligations by mid-October.

Papandreou's cabinet recently announced a new series of austerity measures, including pension cuts and the real estate tax.

It said it was also planning to place some 30,000 civil servants on partial pay by the end of this year. But Finance Minister Evangelos Venizelos was quoted as saying on Tuesday that this and other elements of the package would not be submitted to parliament for approval for weeks.

The troika's inspection teams are due to arrive in Athens again on Wednesday, amid continuing anti-austerity protests and strikes in the country that have repeatedly left the Greek capital without public transport in recent months.

Meanwhile, speaking in Berlin on Tuesday, Papandreou urged Greece's critics to recognise the "superhuman effort" the country is making to cut back its budget deficit.

"If people feel only punishment and scorn, the crisis will not become an opportunity, it will become a lost cause," he said, addressing members of the German Federation of Industry.

Appealing to them not to give up on his country, Papandreou also assured them that Greece is committed to meeting its obligations, but needs more time to carry out the required reforms.

"What we are doing is nothing short of the rebirth of a nation," he said. "I promise you we Greeks will soon fight our way back to growth and prosperity after this period of pain."

Papandreou's plea to European nations to support the measures for containing the debt crisis in the eurozone that were approved in July, along with a second, 109-billion-euro bailout for Greece, was joined by German Chancellor Angela Merkel.

Addressing the German industrialists, she stated her full support for the debt-stricken nation.

"We really respect what Greece has done with respect to structural change," she said before the German parliament is due to vote on Thursday on reforms to the European Financial Stability Facility, the eurozone rescue fund.

"We will give any support possible to Greece ... so that we will not have bad news month after month," the DPA quoted the German chancellor as saying.

- Provided by Southeast European Times

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Greek Parliament Approves New Property Tax