ATHENS, Sept 6 (Reuters) – Greek Prime Minister Kyriakos Mitsotakis revealed a comprehensive tax relief initiative aimed at supporting families, particularly those with children, as part of a broader fiscal overhaul totaling 1.6 billion euros ($1.87 billion). The measures, disclosed during his annual economic address, are set to take effect in 2026 and include across-the-board reductions of two percentage points in income tax rates. n nThe government plans to fund the package through robust economic expansion, a larger-than-anticipated budget surplus, and improved tax compliance. Mitsotakis emphasized that safeguarding household incomes remains a top priority, acknowledging widespread financial strain among citizens. n nAlthough Greece has rebounded from its prolonged debt crisis thanks to a thriving tourism sector, the country still carries the heaviest public debt burden in the European Union. Despite a 35% rise in the minimum wage over recent years, rising costs for energy, food, and housing continue to suppress disposable income and erode consumer purchasing power. n nAdditional components of the reform include eliminating income tax for low-earning households with four dependents and for young professionals, addressing demographic challenges such as declining birth rates and escalating property prices. The plan also features pension increases and the elimination of a property levy in rural regions, aiming to incentivize younger populations to relocate from urban centers. n nPublic reaction has been mixed. While the administration promotes the reforms as a tool for economic resilience, opposition groups and labor unions have criticized the pace and scope of change. Demonstrations took place in Thessaloniki during the prime minister’s speech, with participants calling for better wages and improved living conditions. n nSeparately, protesters in Athens demanded accountability for a fatal 2023 rail accident that claimed 57 lives, accusing the government of failing to address systemic safety flaws and obstructing a transparent investigation. Maria Karystianou, whose daughter perished in the crash, stated that families affected deserve clarity about what caused the tragedy. n nMitsotakis’ New Democracy party, once commanding strong electoral support with 41% in 2019, has seen its approval ratings dip to between 22% and 25% in recent polls, reflecting growing public dissatisfaction. n
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Greek PM unveils tax breaks amid cost of living crisis
ATHENS, Sept 6 (Reuters) – Greek Prime Minister Kyriakos Mitsotakis on Saturday announced generous income tax breaks to boost households with children, part of a tax reform worth 1.6 billion euros ($1.87 billion). n nThe tax deductions, announced during his yearly speech on economic policy, come as his government seeks to halt a slide in popularity caused by a protracted cost of living crisis and corruption claims. n nSign up here. n nStrong economic growth, a higher-than-expected budget surplus and more comprehensive tax collection will help finance the package, which will come into force in 2026, Mitsotakis said. n n”We are all well aware that Greeks are struggling to make ends meet. Therefore our non-negotiable priority is to prop up their income,” he said. n nAfter a 2009-2018 debt crisis marked by years of economic pain, Greece ‘s economy, driven by tourism, has revived and is approaching its . n nBut Greece remains Europe ‘s most indebted nation and disposable incomes still trail the EU average due to rising energy, food and housing prices that hurt purchasing power, despite a cumulative 35% minimum wage increase. n nThe tax reform includes lower taxation by two percentage points for all brackets and a zero tax rate for low-income families with four children and young workers amid tumbling birth rates and rising housing costs. n nMitsotakis also announced increases in pensions, while a real estate tax for remote areas will be scrapped to encourage young people to leave big cities and move to the countryside. n nMitsotakis ‘ centre-right New Democracy party has seen its ratings drop to around 22-25% in opinion polls since June from the 41% of votes it won in 2019 when it came to power on pledges to redistribute the fruits of economic growth more evenly. n nThousands of people joined separate protests organised by trade unions in the city of Thessaloniki, where Mitsotakis was giving his speech, demanding higher salaries and decent living standards. n nIn Athens, thousands demanded justice over a deadly 2023 train crash that killed 57 and protested over what they said was an incomplete judicial investigation into the causes of the disaster. n nThe opposition has accused Mitsotakis ‘ government of shirking responsibility over the crash, failing to fix critical safety gaps in the railway, and covering up evidence that would help shed light on the causes of the disaster. n n”For us, who have to live the rest of our lives in this pain, the least we deserve is to know what happened,” said Maria Karystianou, whose daughter died in the crash. n n($1 = 0.8542 euros) n nReporting by Angeliki Koutantou and Alexandros Avramidis; Additional reporting by Lefteris Papadimas; Editing by Alexandra Hudson and Franklin Paul