If nothing else, after the outcomes of the Eurocalp, Kyriakos Mitsotakis is on the ropes. But when something stood out final week, it was his cussed refusal to cut back heavy oblique taxation (VAT and VAT) which comes as a share improve in gross revenue, in addition to to intervene to mitigate the unfair presumptive tax. This populist who, making the most of the comfort of the European mechanisms because of the pandemic, borrowed lavishly by offering crumbs within the type of advantages to the various and direct assignments to the “unrepentant”, now accepts his destiny, which translated right into a lack of virtually 1 million votes for the ND. However he has a purpose for his cussed refusal.
Subsequent Friday, the European Fee is anticipated to announce the fiscal targets that Greece ought to obtain for the following 4 years.
That is the brand new Stability Pact that shall be legitimate for the interval 2025-28. So now comes the time to pay for what Mr. Mitsotakis did to the Greek financial system since 2019, when the general public debt ballooned. Suffice it to level out that the debt on 31.6.2019 amounted to 356 billion euros and he has reached it to 406 billion euros, opening the hole in 5 years by 50 billion euros. It might not have reached the heights of 130 billion euros reached in a five-year interval (2004-09) by the Karamanlis administration, however given the memo period, the opening of the hole by 50 billion euros is equally disastrous for the Greek financial system.
Prison administration
The problem is that the small and center courses of society pays for the prison monetary administration of Mr. Mitsotakis. It’s a provided that with a purpose to obtain the targets, the GDP must be constantly developed in a tax-efficient approach.
This follows from the overall rule of the brand new Stability Pact as Greece ought to constantly scale back the debt-to-GDP ratio and the first deficit ought to be constantly under 3%.
Right here there may be additionally the unknown X of the scale of the austerity that the Fee will impose on us, since because of the state of the Greek financial system a ceiling of public expenditure of two.5% of GDP could also be imposed.
Once we discuss a main surplus or deficit, we consult with the federal government’s revenues (primarily taxes) much less its bills, with out together with the curiosity paid on public borrowing.
We must also take note of that there isn’t any adequate manufacturing base of the Greek financial system, as even the one which existed earlier than the Mitsotakis scandal has been disintegrated on the one hand by the deindustrialization caused by the price of electrical energy (twelve factories have already been closed), then again by the destruction of the Greek productive land from fires and floods (our export product is agricultural merchandise).
Taxes are a technique
Subsequently, with a purpose to obtain the targets, we must improve the GDP in each approach.
Provided that in 2027 the cannula from the Monetary Stability Fund that enables accounting alchemy with the withholding of group funds which can be recorded in revenues and never offered to the market will cease operating, what’s going to observe is a technique. Taxes upon taxes. Uncontrolled profiteering to gather oblique taxes by means of VAT and VAT. Non-indexation of the tax scales to extend the direct taxation of incomes (salaries and pensions).
This, in fact, interprets into authorities celebrations for the overperformance of revenues. It’s about squeezing society to save lots of the general public funds.
We skilled it within the memorandum period with the governments of Simitis and Karamanlis responsible.
Mr. Mitsotakis governs with 50% of the ministers coming from the Simitis aspect – the remaining belong to ND. “Historical past repeats itself the primary time as a tragedy and the second time as a farce.”
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