Key facts
- Greek Prime Minister Kyriakos Mitsotakis announced a tax reform package worth billions of euros.
- Measures include income tax breaks, wage increases for workers, pensioners, and the self-employed.
- A €400 annual bonus for pensioners and €500 for public servants are included.
- The minimum salary will be raised to €950 monthly, increasing to €1,000 in 2028.
- The reform package is valued at €2.2 billion for 2027, approximately 1% of Greece's GDP.
Greek Prime Minister Kyriakos Mitsotakis has unveiled a significant tax reform package aimed at boosting incomes ahead of the country's elections next year. The measures, with an estimated cost of €2.2 billion for 2027, equivalent to about 1% of GDP, include an annual bonus of €400 for pensioners and €500 for public servants. Additionally, low-income farmers and families with three children will benefit from zero income tax, while self-employed individuals and small businesses will see a reduction in advance tax payments.
The minimum salary is set to increase to €950 per month, with a further rise to €1,000 planned for 2028. Pension contributions will also be reduced by 0.5%.
Mitsotakis' center-right government, re-elected in 2023 with a strong mandate, is now facing slipping support amid a cost-of-living crisis and corruption allegations. Despite these challenges, Greece's economy is performing well, with an annual growth rate of 2%, surpassing the euro zone average. The country anticipates a primary surplus of approximately 4% of GDP this year, providing the fiscal space for these new initiatives.