Saturday, February 13, 2010

Greece Outlaws Cash Transactions Above 1500 Euros, Unveils New Taxes

In an attempt to rein in the shadow economy and collect more tax revenue, Greece outlaws cash transactions greater than 1500 Euros. Please consider Greek Finance Minister unveils tax reform, wage policy. http://www.reuters.com/article/idUSLDE61824V20100209

"From 1. Jan. 2011, every transaction above 1,500 euros between natural persons and businesses, or between businesses, will not be considered legal if it is done in cash. Transactions will have to be done through debit or credit cards"

"There's tax relief for incomes up to 40,000 (euros)"

"Taxable income based on the new scales will include capital gains from the short-term trading of stocks"

"Deposits in banks outside Greece are exempted from audits of their origin if they are repatriated within six months of the passing of the tax bill and are taxed with a 5 percent rate"

"Wages of board members in unlisted state companies will fall by 50 percent"

"The budget bill for allowances and compensations will be cut by 10 percent"

Buy It Now

Everyone in Greece will quickly figure out that that the time to make major purchases is now. So expect to see sales plunge starting January 1, 2011 as demand for everything priced above 1500 euros shifts forward.

New 40% Tax Rate

In addition, attempts to collect more sales taxes (VAT), Greece to levy 40% tax rate on more earners. http://www.reuters.com/article/idUSLDE6170CY20100208

Greece will lower the current 75,000 euro income threshold that is subject to a 40 percent tax rate as part of reforms to urgently boost government revenues, the country's finance minister said on Monday.

"The 40 percent tax rate will be applied on income levels that are lower than what is the case today, but there will also be intermediate rates that will provide relief for low and middle incomes," Finance Minister George Papaconstantinou told Ta Nea newspaper in an interview.

He said that as a result of the tax changes, the biggest burden would be felt by a small percentage of tax payers as 95 percent of earners report incomes below 30,000 euros a year.

Retirement Age, Fuel Taxes Rise

Please consider Greece raises retirement age and fuel taxes a day ahead of nationwide civil service strike. http://blog.taragana.com/business/2010/ ... ike-29494/

Prime Minister George Papandreou told a cabinet meeting that the reforms “must go ahead now … with greater speed.â€