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Tax drive proposes deductions for weddings and karate lessons
Weddings, parties and karate lessons would become tax deductible in Greece under a new law aimed at cracking down on rampant tax evasion and reducing the country's fiscal deficit.
- Reuters
- Published: 00:12 July 20, 2007
Athens: Weddings, parties and karate lessons would become tax deductible in Greece under a new law aimed at cracking down on rampant tax evasion and reducing the country's fiscal deficit.
Presenting the draft legislation, Finance Minister George Alogoskoufis said yesterday more personal expenses will be tax deductible to encourage Greeks to ask for more receipts.
"Cracking down on tax evasion is a top priority: it is a phenomenon that results in social injustice and constitutes a very serious crime," Alogoskoufis said.
"Each time a citizen does not ask for a receipt, someone else will miss out on something. A school, a hospital, a social benefit," he added. Greece has sought to improve tax collection as part of its plans to further cut its budget deficit, and to stamp out the unofficial "grey economy", estimated at about 30 per cent of its gross domestic product.
Budget deficit
Greece's ruling conservatives have already managed to improve tax collection by cross-checking data and to reduce the country's budget deficit to below the EU ceiling of 3 per cent of GDP, earning praise from Brussels.
Greece has been threatened with EU sanctions after under-reporting its budget deficit to Brussels for years, including when it joined the euro.
Its budgetary performance may improve further next year after an upward revision in its GDP of some 25 per cent, which is awaiting approval by Eurostat, the EU's statistics agency.
Under the new law, taxpayers can deduct 40 per cent of annual spending on family costs of as much as 8,000 euros a year.
The costs include wedding and baptism receptions, restaurant and taverna bills, dance, martial arts and swimming lessons, as well as hairdressing and diet centre fees, according to the draft law. "Those who abide by these rules will be rewarded," Alogoskoufis said. "This extra revenue will be used to finance healthcare, education and stamp out poverty."
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