A new tax bill for 2013 was passed by the Greek Parliament on January 11, introducing a three-tier system for personal income taxation, a separate tax on rents and on the retirement lump sum payment, as well as increases on capital interest tax. The new tax scale envisages a 22% tax rate for salaried employees with incomes up to € 25,000; the next € 17,000 will be taxed at a 32% rate, while a 42% tax rate will be imposed on higher incomes.

The self-employed will be taxed at 26% for the first € 50,000 and at 32% for higher brackets. The tax-free threshold of € 5,000 per year is abolished and pensioners and employees are required to provide receipts worth 25% of their gross annual income -in case they fail to do so, the new law envisages a penalty of 22 % tax on the difference between the value of receipts collected and the value of the receipts lodged.

The tax rate on capital interest will be raised from 10% to 15% and earnings from property transactions are to be taxed at 20%. Moreover, for enterprises, the tax on undistributed earnings will be raised from 20% to 26%, while tax on dividends will be reduced from 25% to 10%.

According to the new tax regime, farmers are levied as traders irrespective of income bracket or size of land. In addition, most tax exemptions are abolished, apart from medical / hospital expenses, scholarships, sponsorships and alimony payment. Finance Ministry: Draft Tax Law [in Greek]

Kathimerini Daily: Ministry tables tax bill that cuts exemptions, thresholds