Greek Premier Kyriakos Mitsotakis Unveils €1.6 Billion Tax Cuts To Support Middle Class

Greek Prime Minister Kyriakos Mitsotakis has unveiled a significant €1.6 billion reform of the nation's income tax system. This initiative aims to support the middle class, which has faced challenges in recovering from prolonged economic difficulties. The announcement was made during his annual policy speech, outlining the government's priorities for the upcoming year.

Mitsotakis highlighted several tax cuts, especially for families with children. Families with four or more children will not pay income taxes on their first €20,000 of annual earnings. This measure is intended to address Greece's low birth rates by providing financial relief to larger families.

The reform includes additional benefits for pensioners and improved wages for security-force personnel and diplomats. These measures are part of a broader strategy to alleviate the financial strain caused by rising living costs and stagnant real wages.

During his speech at the Thessaloniki International Fair, Mitsotakis acknowledged that high prices are a major concern for citizens. He stated that the tax reforms are specifically designed to tackle this issue and provide much-needed relief.

Mitsotakis assured that all announced changes have been carefully calculated and align with Greece's European commitments. The measures include reduced income tax rates and exemptions for specific groups, such as young workers under 25 earning up to €20,000 annually.

Additionally, there will be a lower tax rate for incomes ranging from €40,000 to €60,000. Income from rental properties will also benefit from reduced taxation under these new reforms.

Support for Rural Areas

Residents of small villages with populations not exceeding 1,500 will see a reduction in property taxes. They will pay half the amount in 2026 and none from 2027 onwards. Furthermore, value-added tax on remote islands with fewer than 20,000 inhabitants is being cut by 30 percent.

The comprehensive package of reforms aims to ease financial burdens on Greek citizens while encouraging economic growth and stability across various sectors.

With inputs from WAM