Greece now appears as a “world champion” in terms of taxes and contributions, an ominous distinction that will downgrades the country’s business competitiveness indexes, following a new package of increases tabled and reportedly approved by institutional creditors.
According to most reports, the corporate tax rate will return to 29 percent from the current 26 percent, while a 1 percentile increase in the contributions paid by employers’ for their employees’ social security is also on the horizon – assuming that creditors do not nix the measure.
The tax rate for dividends will go from 10 to 15 percent.
Greece was already very high on the OECD list of high tax countries, far higher than the average for EU countries. However, after the pending increases, the recession-plagued country figures as even more “inhospitable” for potential investors
If the new hikes are added to the current tax regime, a company that generated 100,000 euros in profits in 2015 would retain 57,490 euros after all taxes, contributions and pre-payments of future taxes are deducted, which means an actual tax rate of 42.5 percent.
